Sintex Industries Meet/102742_20080110.pdfSTOCK DATA 52-Week Range (Rs) 615/185 Major Shareholders (September 2007)(%) Promoters 31.3 Domestic Institutions 10.8 FIIs/FDIs 21.7 Others

Sintex Industries

In-depthSECTOR: DIVERSIFIED

New growth enginesManish Karwa ([email protected]) +91 22 3982 5409

Sintex Industries

210 January 2008

Contents

Page No.

New growth engines in place ........................................................................... 4-5

Monolithic construction - huge business opportunity ...................................... 6-8

New acquisitions - leapfrogs into big league ................................................. 9-14

Current businesses - well placed for strong growth .....................................15-20

Capital raising to support future growth ......................................................21-22

Financials and valuations .............................................................................23-24

Company background ..................................................................................25-26

Appendix: Customer profile of recently acquired companies ......................27-28

Financial statements ....................................................................................29-32

STOCK DATA52-Week Range (Rs) 615/185

Major Shareholders (September 2007) (%)Promoters 31.3Domestic Institutions 10.8FIIs/FDIs 21.7Others 36.2

Average Daily TurnoverVolume ('000 shares) 454.3Value (Rs million) 147.21/6/12 Month Rel. Performance (%) 16/69/1041/6/12 Month Abs. Performance (%) 19/106/158

Sintex Industries

KEY FINANCIALSShares Outstanding (m) 110.9Market Cap. (Rs b) 60.7Market Cap. (US$ b) 1.5Past 3 yrs Sales Growth (%) 24.6Past 3 yrs NP Growth (%) 59.9Dividend Payout (%) 12.6Dividend Yield (%) 0.2

Y/E MARCH 2007 2008E 2009E 2010E

Net Sales (Rs m) 11,653 23,603 39,215 52,363

EBITDA (Rs m) 2,227 3,766 7,147 10,512

Adj. NP (Rs m) 1,329 2,297 4,713 7,061

EPS (Rs) 12.0 16.0 32.9 46.8

EPS Growth (%) 26.1 33.7 105.2 42.5

BV/Share (Rs) 58.9 154.2 183.5 255.4

P/E (x) 45.7 34.2 16.7 11.7

P/BV (x) 9.3 3.5 3.0 2.1

EV/EBITDA (x) 28.6 16.0 8.8 5.3

P/Sales (x) 25.7 12.7 7.6 5.7

RoE (%) 21.6 15.5 18.8 21.0

RoCE (%) 16.0 12.6 15.8 20.4

In-depthSECTOR: DIVERSIFIED

310 January 2008

BuyPrevious Recommendation: Buy Rs547

BLOOMBERGBVML IN

REUTERS CODESNTX.BO

10 January 2008

STOCK PERFORMANCE (1 YEAR)

STOCK INFO.BSE Sensex: 20,582

S&P CNX: 6,157

Sintex is a strong play on domestic infrastructure and global plasticsspace. With acquisitions starting to contribute from 3QFY08 coupledwith a strong traction in monolithic and prefab businesses, we expecta 65% CAGR in revenues and 75% CAGR in earnings (57% CAGRin EPS) over FY07-10.

Prefab and monolithic construction - domestic growth drivers:Sintex has pioneered new concepts like prefab and monolithicconstruction in India and emerged as a leader in these segments. Weexpect huge growth in these business segments, driven by the growingdemand for quick and affordable mass housing units. We expect prefabsales to post a CAGR of 46% and monolithic sales to post a CAGR of96% over FY07-10.

Auto and electric plastics – a global opportunity: Sintex hasemerged as a strong player in global composites (high-end plastics)after making four international acquisitions in the auto and electricplastics space in FY08. All these acquisitions are profit making andearnings accretive. FY09 would be the full year of consolidation andwe expect strong traction in earnings. We expect acquisitions tocontribute 27% of consolidated sales in FY09 and 26% in FY10.

Reiterate Buy with a target price of Rs1,030: We estimate Sintexto report an EPS of Rs33 in FY09 and Rs47 in FY10, assuming fulldilution of FCCBs in FY10. We assign a 22x FY10E target multiple toarrive at our 18-month target price of Rs1,030. We are not factoring ingains from any future acquisition, which is likely over the next 6-12months. Reiterate Buy.

150

275

400

525

650

Jan-07 Apr-07 Jul-07 Oct-07 Jan-08-15

20

55

90

125Sintex Inds (Rs) - LHS Rel. to Sensex (%) - RHS

Sintex Industries

410 January 2008

New growth engines in place

One of the key strengths of the Sintex management has been its ability to enter newbusinesses and successfully scale them up. Over the last few years, Sintex has venturedinto electric custom moulded products, pre-fabricated structures, high-end structuredshirtings, etc and has successfully scaled up these businesses. Newer businesses likeprefab, monolithic construction and acquisitions have resulted in a huge growth in plastic/infra segment. As a result, contribution from textiles business is expected to reduce from29% in FY05 to 9% in FY10.

Plastics71%

Textiles29%

Plastics73%

Textiles27%

Plastics91%

Textiles9%

SINTEX: CHANGING BUSINESS DYNAMICS (SALES BREAK-UP)FY05 FY07 FY10E

Source: Company/Motilal Oswal Securities

Prefab and monolithic construction - domestic growth driversWe believe plastics/infrastructure space is likely to be the key growth driver for Sintex.Sintex has pioneered new concepts like prefab and monolithic construction in India andemerged as a leader in these segments. We expect huge growth in these business segments,driven by the growing demand for quick and affordable mass housing units. We expectprefab sales to post a CAGR of 46% and monolithic sales to post a CAGR of 96% overFY07-10.

PLASTICS: SALES TREND (FY07)

Monolithic Constr.

14%

Custom Moulding -

Auto4%

Water Tanks15%

Zeppelin6%

Electric Custom Moulding

11%

BTS Shelter

13%

Prefabs37%


46% CAGR in prefabsales and 96% CAGR inmonolithic construction

over FY07-10

Plastics to contribute91% of sales in FY10

v/s 73% in FY07

Sintex Industries

510 January 2008

BTS Shelter7%

Prefabs21%

Custom Moulding - Auto

4%

Monolithic Construction

19%

Auto Custom Moulding

0%

Acquisition 3 (Nief)17%

Acquisition 2 (Bright

Brothers)6%

Acquisition 1 (Wausaukee)

4%

Wausaukee - Nero1%

Zeppelin 2 - capacity

expansion3%

Water Tanks3%

Electric Custom Moulding

8%

Zeppelin7%

PLASTICS: SALES TREND (FY10E)

SINTEX: SALES BREAK-UP (RS M)FY06 FY07 FY08E FY09E FY10E CAGR

(FY07-10E)PlasticsPrefabs 2,560 3,080 4,800 7,000 9,500 45.6BTS Shelter 700 1,150 2,200 2,600 3,200 40.7Monolithic Construction 702 1,200 2,000 5,000 9,000 95.7Custom Moulding - Auto 300 300 1,350 1,600 2,000 88.2Electric Custom Moulding 700 960 2,200 3,000 4,000 60.9Zeppelin 530 1,500 3,500 4,750 107.7Water Tanks 1,100 1,320 1,373 1,428 1,485 4.0Acquisition 1 (Wausaukee) 800 1,500 1,850 NA - Wausaukee - Nero 200 600 700 NAAcquisition 2 (Bright Brothers) 0 0 440 1,500 3,000 NAAcquisition 3 (Nief) 3,000 7,000 8,000 NA

6,062 8,540 19,863 34,728 47,485 77.2Textiles 2,528 3,168 3,740 4,487 4,879 15.5Total 8,590 11,708 23,603 39,215 52,363 64.8


Auto and electric plastics: A global opportunitySintex has acquired four companies in FY08 to emerge as a strong player in the globalhigh-end electric and auto plastic segments. All these acquisitions are profit making with apayback period of three years. We estimate these businesses would collectively add Rs10.6bto sales in FY09 and Rs13.6b in FY10. We expect these acquisitions to contribute 36%ofEBITDA in FY09.


New acquisitions tocontribute 36% ofEBITDA in FY09E

Sintex Industries

610 January 2008

Monolithic construction - huge business opportunity

Monolithic construction is a method by which walls and slabs are constructed togetherby pouring fluid cement concrete into a light-weight formwork system while using nominalquantities of metallic reinforcement bars for strength and stability. It’s an improvementover in-site construction detailed under IS-2110-1980. This method has proved to beideal for mass housing multi-storied construction, wherein large number of units ofsimilar configuration are required.

The major advantages of monolithic construction are:? Offers low cost housing, typically with life span of at least 25 years. Most suitable

for slum clearance as both cost (lower by 15-20%) and time to construct (lower by50%) are lower.

? Such structures are designed to meet all needs relating to seismic, waterproofing,fire, etc. Maintenance is negligible. Further, fly ash can be one of the ingredients forconstruction, thus reducing environmental pollution.

Affordable and quality housing is a key challenge faced by the Indian government. Thoughthere is a requirement to construct 20m housing units every year, we are only constructing4-5m a year across all housing segments. With private builders concentrating on middleand high income groups, the lower income group and poor people are deprived of properhousing facilities. This offers a huge opportunity for Sintex, as its formwork system offersspeedy construction of high quality houses at affordable prices. While prefabs are used toconstruct only single storey structures, monolithic construction can create structures up tofive to six floors. As per the management, there is a potential market of Rs900b currently,of which Sintex is not even addressing 1% of the market.

SINTEX – FORM WORK


Potential market size ofRs900b for monolithic

construction; Sintex noteven addressing 1%

of the market

Sintex Industries

710 January 2008

SINTEX – REINFORCEMENT WORK MASS HOUSING


Strong traction in order flows seenSintex has demonstrated its ability to quickly deliver affordable mass housing projectsover the last couple of years. We believe as these products get noticed, many more buyers(state governments) will show interest. With the quantum of opportunity being huge, weexpect strong traction in order flows for Sintex.

Sintex had got its first order for Rs7.5b from Gujarat Urban Development Authority in2006, followed by orders from Delhi, Chandigarh and Himachal Pradesh state governments.Currently, Sintex has an order book of more than Rs10b to be constructed over the nextthree years. We believe many more orders from other state governments are in the pipeline.

In our estimates, we are assuming revenue of Rs2b in FY08 and Rs9b in FY10. As thequantum of operations is large (one order itself is Rs7.5b), new order inflows can significantlyincrease the revenue expectations through this business. However, the company is goingslow on procuring new orders, as the key issue is execution. The management does notintend to take orders, which they think they will be unable to complete.

MONOLITHIC CONSTRUCTION: EXPONENTIAL GROWTH AHEAD (RS M)


1,2002,000

5,000

9,000

FY07 FY08E FY09E FY10E

Current order book ofmore than Rs10b

Sintex Industries

810 January 2008

EBITDA margin at 18%; long working capital cycleWe expect strong margins on the back of a strong growth in sales. Currently, the divisionis operating at 18% EBIDTA margin and we expect the trend to be maintained in future aswell. However, the division operates on a long working capital cycle, as debtor days arehigh (90-180 days) as government is the buyer. At the time of the order, Sintex gets 10%of the money upfront, but 90% of the revenue comes only after the delivery of the wholeblock. Also, since the company does not own the land, the banks are unwilling to financethe project, resulting in high cash requirement.

Key risksDelay in government clearanceWhile we do not envisage any dearth of orders, delay in getting site clearance or clear titlefor the land could delay the sales cycle. This would also result in lower EBITDA margin,as the company would keep on incurring labor cost.

Sintex Industries

910 January 2008

New acquisitions - leapfrogs into big league

The management, which was keen to get into auto plastics and composites, had raisedfunds through FCCB in 2005 for acquisitions. However, the acquisitions happened only in2007, as the management spent lot of time on due diligence to arrive at the right candidates.We believe these acquisitions, though delayed, have placed Sintex in the big league in autoplastics in Europe, Asia and North America.

Key acquisitionsNief Plastic, France? Date of acquisition: 1 October 2007? Acquisition value: Euro 30.70m? Sales for 2006: Euro 114.33m? PAT for 2006: Euro 2.17m? Product Profile: Electricals, automotive, aerospace, sports/leisure? Strategic reason for acquisition: Latest technologies, wide and enhanced product

portfolio, innovation, and superior customer service

Wasaukee Composites, USA? Date of acquisition: 1 June 2007? Acquisition value: US$20.50m? Sales for 2006: US$23.20m? PAT for 2006: US$1.66m? Product Profile: Composite plastics? Strategic reason for acquisition: Product excellence, process innovation, and superior

customer service

Bright Brothers, India? Date of acquisition: 6 December 2007? Acquisition value: Rs1,490m? Sales for 2007: Rs153.81m? EBITDA for 2007: Rs202.91m? Product Profile: Automotive parts? Strategic reason for acquisition: Entered into domestic automotive segment

Nero Plastic, USA? Date of acquisition: 3 December 2007? Acquisition value: US$4.77m? Sales for 2006: US$17.40m? PAT for 2006: US$0.63m? Product Profile: Composite plastics? Strategic reason for acquisition: Enhance product mix and provide impetus to existing

composites business.

Sintex Industries

1010 January 2008

Nief Plastic: Play on auto plastics and compositesNief Plastic has been ranked as the number one company in France’s composites industryand is well-known for its high quality standards, technical skills and high performancepolymer know-how. Nief caters to user industries like automotive, electrical, aerospace,defense and mass transit systems through manufacturing locations in France and low-costcountries. Most of Nief’s customers apply a Just in Time strategy for their inventories. Tobe responsive to customer demands, the factories have to be located near the customer.Nief has followed its customers’ move towards offshoring by setting up factories in EasternEurope and North Africa.

LOCATIONS OF NIEF PLASTIC GROUP'S FACILITIES


NIEF PLASTIC SAGenas-France

ThermodoleSAS Done-

France

Siroco SASGenas-France

NP TunisiaSARL

Naagcen-Tunisia

NP SlovakiaSRO

Bratidava-Slovakia

NP Hungaria KftKunszentmarlon-

Hungary

SegaplastSAS

Beauchaslel

Segaplast SACasablanca-

Maroc

NP VosgesSAS

St Die-France

NP NordSAS

Caudy-France

NP SavoieSAS

BelmontTramonel-

France

Development and production of own products

NIEF PLASTIC – GROUP STRUCTURE

Sintex Industries

1110 January 2008

KEY USER INDUSTRIES OF NIEF PLASTIC: AUTOMOTIVE AND ELECTRICAL & ELECTRONICS

35 4050

60 65 70

100115

130

110120

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

e

CONSISTENT GROWTH IN REVENUENIEF GROUP'S REVENUE EVOLUTION (€M)

MAIN ELEMENTS OF BALANCE SHEET (2000-2005)(€ M - FY END 31/12) 2000 2001 2002 2003 2004 2005Net Fixed Assets 9.9 10.7 12.5 14.6 21.6 21.0Wkg. Cap. Requirement 9.1 8.4 12.6 12.3 13.9 11.9In US$ of Sales (%) 13.8 12.2 12.5 10.7 10.8 10.8Shareholders Equity 10.6 11.4 15.7 16.3 17.5 16.0Financial Liabilities 9.1 9.0 9.5 10.7 18.3 16.7In US$ of ShareholdersEquity (%) 85.8 78.9 60.5 65.8 104.8 104.9



Electricity28%

Miscellaneous7%

Household App.3%

Building4%

Sports1%

Finished Products

5%Defense/

Aerospace2%

Automotive Industry

50%


Key positives: Superior technology; widespread distribution; access to customersNief currently operates through diversified technologies such as injection of thermoplastics,injection and compression of thermo sets, over moulding of bi-materials, precision moulding,high performance polymers with thermo-stables, decoration, post moulding assembly andsurface finishing.

It has facilities across Europe and Africa: 7 plants in France, 1 in Hungary, 1 in Slovakiaand 1 each in Tunisia and Morocco. It has 284 presses for injection of thermoplastics, 33presses for injection of thermo sets, 30 presses for compression of thermo sets and qualitycertified for ISO 9001, ISO/TS 16949, ISO 14001, EN 9100 and AQAP 2120. This placesSintex among the top 10 players in auto plastics space in Europe.

Acquisition of Nief placesSintex among the top 10players in auto plastics

space in Europe

Sintex Industries

1210 January 2008

The acquisition also allows Sintex to have direct entry into Tier 1 suppliers of leadingautomobile players, which would have been difficult on its own. Also, as many of thesesuppliers have their base in India, Sintex can meet their requirements through its ownplants in India. (Refer Appendix for list of key customers).

EBITDA margin to improve from 9% to 13% in 3 yearsSintex has retained most of the management team, which shall help Nief integrate withthe company. As one of the key cost components for Nief is labor (30-35% of the totalcost), Sintex intends to shift high labor-oriented and low value add products to India. Thisshall result in significant labor cost savings for Nief over the next few years. Themanagement expects the EBITDA margin to move up from current 8.8% to 12.5-13%over the next three years.

Acquisition at 4.4x CY07E EV/EBITDA highly attractiveSintex acquired Nief at an enterprise value of Euro 44m, while the expected EBITDA forCY07 was Euro 10.6m. The acquisition price was 4.4x CY07E EV/EBITDA, which webelieve is extremely attractive. Overall, Nief is likely to have to have a topline of Euro120m in CY07. While we expect sales to grow at 10-12% over the next few years, risingEBITDA levels are likely to lead to significant growth in earnings.

Bright Brothers to complement Nief acquisitionSintex has acquired the automotive plastic business of Bright Brothers Ltd. The acquisitionhas been done by Bright Autoplastic Pvt Ltd, a downstream subsidiary of Sintex HoldingsB.V. Netherland (Sintex Offshore Holdings).

Key positives: Presence in auto plastics in India; strong customer profileBright Brothers has a strong presence in automotive components space in India, whichincludes various body parts, automotive parts, instrument panels, consumer durablecomponents (white goods body parts like twin tube, agitators and styling parts).

Sintex has taken over only the auto manufacturing plants on a slump sale basis for Rs1.49b.The company will also acquire 400 employees from the existing workforce of the automotivedivision. The current promoters of Bright Brothers would continue to lend strategic supportto Sintex subsequent to the transaction.

With this acquisition, Sintex would gain access to customers in the automotive space suchas Maruti Udyog, Hyundai, Tata Motors and Mahindra & Mahindra. Another advantageis that all its plants are located near the automotive manufacturing hubs at Chennai, Sohna,Pune, Pithampur and Nasik (covering the West, North and South).

Sintex intends to shift highlabor-oriented and low

value add products to India

Sintex would gain access toMaruti Udyog, Hyundai,

Tata Motors and M&M forautomotive plastics

Sintex Industries

1310 January 2008


With the unutilized capacity, the current plants would complement increased outsourcingfrom Nief, thereby saving on costs. At full capacity, the management expects about Rs3.5-4b of sales.

Auto plastics: Upcoming segment with huge potentialIn the auto plastics segment, Sintex is primarily functioning as an auto componentsmanufacturer supplying fuel tanks, cable trays, etc. Here, it caters to companies such asCummins, GE and tractor manufacturers like M&M and New Holland Tractors.

As per a study by AT Kearney, 14% (by weight) of plastics is used in cars, which is likelyto increase to 22% by 2010. However, in India, the usage of plastics in cars is only ~7%,which shall also increase to 20-22% by 2012. With India emerging as a global car hub, webelieve auto plastics are likely to be a big opportunity for players like Sintex.

Wausuakee acquisition: Leg up in the composite businessSintex has acquired an 81% stake in Wausaukee in an all cash deal for US$20.5m. Thecompany has a right to acquire the remaining 19% subject to certain conditions and price.The key products of Wausaukee are medical imaging, industrial/agricultural equipment,wind energy, commercial furnishings, recreation and corrosion-resistant materials.

The acquisition has enabled the company to expand its product portfolio in the autocomponents business in India and the US. At a later stage, Sintex shall also bring the

817959

1,270 1,3001,500

2,750

FY05 FY06 FY07 FY08E FY09E FY10E

Acquisition at 6x FY08E EV/EBITDA; 50% utilization levelsSintex has acquired the company at 6x FY08E EV/EBITDA. The acquired plant hasEBITDA margin of 15-16% and is currently running at 50% capacity utilization.Themanagement expects sales of Rs1.5b from this plant in FY09.

BRIGHT BROTHERS: SALES TREND (RS M)

Auto plastics likely to be abig opportunity for Sintex

Sintex Industries

1410 January 2008

manufacturing process to India and thereby lower its cost of production. As almost 50%of Wausaukee's customers are Fortune 500 companies, Sintex will have establishedrelationships with global auto players, which it can use to supply products to the Indianoperations of these companies. Through Wausaukee, Sintex has acquired Nero Plastic forUS$5m, which has a similar product profile.

Acquisition at 4.6x FY06 EV/EBITDAWausaukee had sales of US$23m in FY06 with gross margins of 24% and is profit makingat the net level. Thus, the valuation at FY06 sales works out to 4.6x FY06 EV/EBITDA,which is attractive. We are factoring in sales of Rs0.8b in FY08 and Rs1.9b in FY10through this acquisition with a 20% EBITDA margin.

Zeppelin: Delivering strong growthZeppelin Mobile Systems India Ltd is a joint venture between Sintex and Zeppelin MobileSysteme, GmbH, Germany. Sintex acquired 74% stake in Zeppelin in 2005. It is one of thetop two telecom shelter manufacturing companies in India today with an estimated marketshare of 25%. Its main products include telecom shelters (static and mobile application),radar shelters, mobile maintenance shelters, mobile hospitals and ambulances, refrigeratedvehicles, etc.

Capacity expansion would lead to strong growthSintex proposes to expand Zeppelin’s manufacturing facility and has set aside a capitaloutlay of Rs1b towards this. Post expansion, the capacity will stand at 15,000 shelters asagainst the current capacity of 7,500 shelters. As part of the programme, the company willbe installing state-of-the-art machinery including large automatic presses.

The expansion will also enable the company to backward integrate and manufacture severalnon-plastic ancillary products like locks, hinges, etc, resulting in greater operatingefficiencies. Additionally, with a larger and wider portfolio of offerings, Sintex will be wellpositioned to optimally leverage its strong presence in East and South India.

SALES GROWTH FOR ZEPPELIN MOBILE SYSTEMS (RS M)

365 364 600

1,500

3,500

4,750

FY05 FY06 FY07 FY08E FY09E FY10E


Almost half of Wausaukee'scustomers are

Fortune 500 companies

Sintex Industries

1510 January 2008

Current businesses - well placed for strong growth

1. Prefab: 46% revenue CAGR over FY07-10ESintex, which has pioneered a number of value-added plastic products in India, was thefirst to come out with plastic prefabricated range of products in the country. Sintex prefabs,which are available in various types and designs, find diverse uses, ranging from temporaryand semi-temporary to permanent structures. They are ideal for erecting schools, kiosks,huts, tent substitutes, hospitals, police stations, offices, telephone exchanges, post officesand even community halls.

Prefabs are used globally for a variety of applications including temporary and permanentstructures, which find usage in residential as well as commercial applications. Sintex useshoneycomb concrete between plastic channels, which makes these structures lighter andeasier to transport. As the name suggests, these structures are pre-made at the factoryand minimum work is done on the actual site. This reduces the cost by 25-40% and thetime for erection by 85-90% as compared to conventional structures.

The revenue from prefab business has grown from Rs1.6b in FY04 to Rs3b in FY07. Weexpect the strong growth to continue as prefab structures get increasingly accepted inIndia. We estimate revenue of Rs9.6b in FY09, a CAGR of 46%.

PREFAB: ON STRONG REVENUE GROWTH TRAJECTORY (RS M)

32.3%37.1%65.5%29.841.7%43.8%

FY04 FY05 FY06 FY07 FY08E FY09E FY10E

1,6002,300

3,2604,230

7,000

9,600

12,700

YoY growth Source: Company/Motilal Oswal Securities

Rural segment offers big growth opportunityWe believe the growth opportunity in this segment is immense, as prefab is a fairly newconcept in India. We believe though it would take a lot of time for this concept to beaccepted in the urban markets of India, the rural markets, which want durable low coststructures, show immense growth potential. The housing segment too may take time tocatch on; however, the government/private aided schools, health centres, public toilets andpublic kitchens offer big opportunities.

Prefab reduces the cost ofthe structure by 25-40%

and the time forerection by 85-90%

Sintex Industries

1610 January 2008

Logistics – a key factorWe believe logistics is a key factor in the prefab business, as the goods have to be transportedfrom the factory to the site, where the prefab structure is to be put up. Thus, the skill liesin transporting the goods in an efficient manner and installing the structure at the sitequickly. For a standard sized structure of 600 sq ft, a single truck load can carry all thematerial required to the site. This structure is then put up by six workers in six days -complete in all respects (wiring, piping, insulation, etc) and ready to use. Currently, Sintexhas a 4,500-strong trained workforce to execute this business.

New plants – ramp up in utilization to drive growthPrefab business requires regional plants to cater to areas within ~1,500 km radius. Thisminimizes transportation costs, which form a significant part of the total expenditure, andalso reduce turnaround time. Over the last 18 months, Sintex has set up plants in Salem,Baddi and Nagpur targeting the southern, northern and central states. It is in the processof setting up its Kolkata plant. Post these expansions, the company will be present in fivelocations enabling it to cater to the requirements of 24 states, which make up 70% ofIndia’s geography. Sintex has already started to generate orders from the Andhra Pradesh,Karnataka and Delhi governments.

A new prefab plant requires about Rs550-600m of capex and can deliver sales of up toRs3b on full utilization. Currently, only the Kalol plant is running at 100% capacity utilizationwhile other plants are running at 30-70% utilization. However, we expect capacity utilizationto increase over the next two to three years, as sales from its new plants increase. Thisshall result in higher EBITDA margin for the business. We expect EBITDA margin toincrease from 17% in FY07 to 19% in FY10.

2. Power segment: 61% sales CAGR over FY07-10ESintex is also a major player in electrical enclosures and accessories catering to most ofthe players in electricity distribution by supplying FRP metre boxes. It is one of the largestmanufacturers of tamper proof meter boxes in India, supplying to state power utilities ofTamil Nadu, Andhra Pradesh and Chattisgarh among others.

In electricals, Sintex is in the mid and high-voltage segment making enclosures, loop-in/loop-out boxes, polymeric insulators, insulator boxes, cross–arms and other accessoriesfor mid segment, i.e. 440-1,200 volts, and high-end that goes up to 11KVA. These productsare made from pultrusion and fiber glass and find application in high and medium voltagetransmission lines set up by SEBs and private power manufacturers.

Sintex has a capacity of 4,000 tonnes of enclosures, which is being expanded to 16,000tonnes. We believe the quadrupling of capacity will enable the company to optimally caterto the strong growth anticipated due to the large investments in the power sector. Weexpect electric custom moulding sales of Rs4b in FY10as compared to Rs960m in FY07.

EBITDA margin to increasefrom 17% in FY07 to

19% in FY10

Sintex is one of the largestmanufacturers of tamper

proof meter boxes in India

Sintex Industries

1710 January 2008


3. Automotive custom moulding likely to be a steady-state businessWithin the automotive custom moulding division, it manufactures customized plastic productsfor OEMs like Cummins, GE, New Holland Tractors and French Railways etc. Thecontracts are long term in nature and are growing in number every year. Sintex is in theprocess of scaling up the number of products and the management expects the business toregister a 25% CAGR over FY08-FY10.

4. Market leader in plastic overhead tanksSintex is the leader in the plastic overhead tanks, a concept that it had pioneered in India.The company started this operation in 1975 and at present has 1,200 agents, 650 dealers,18 offices, 22 depots and close to 10,000 retailers. We believe the wide distribution networkis Sintex’s greatest strength as it is a deterrent to competition (in a not so capital-intensivebusiness). A key aspect of this business is logistics. Since water tanks are voluminousproducts, they are difficult to transport. Thus, it is necessary for a player wanting anationwide presence to have locations at different places. Sintex has 12 manufacturingfacilities and plans to soon commence operations at another two locations.

Sintex has a 55% share in the organized overhead plastic tank market, while the immediatecompetitors Patton and National have less than 10% market share each. Since, this is amatured business, the growth rate for Sintex is low. The margins are also very low due tocompetition from a lot of unorganized players. However, this business allows Sintex toretain its distribution strength and the brand value through which it can push a lot of otherplastic-related products.

As the overhead water tank is a fairly penetrated and matured market in the urban andsemi urban areas, the incremental growth is likely to come from new constructions andrural and semi-rural areas. We expect growth rate in this segment to be subdued at 6-7%over the next two to three years. We expect the operating margins to be in the range of6-7%, while at the net level, the margins would look miniscule.

700960

2,200

3,000

4,000

FY06 FY07 FY08E FY09E FY10E

ELECTRIC CUSTOM MOULDING - SALES GROWTH (RS M)

25% CAGR over FY08-10E

55% market share inorganized overhead

plastic tanks

Sintex Industries

1810 January 2008

5. Textiles: High-end focus continues; steady growth aheadSintex’s textile division, Bharat Vijay Mills (BVM), has a presence in high-end fabrics.Textiles have always been a high margin segment for Sintex as its OPMs have neverfallen below 22%, and currently the EBITDA margin from the textile division is 28-30%.The textile business has been positioned as a boutique as opposed to a volume-drivenentity; consequently, Sintex focuses on high value orientation and caters to the Europeanmarket rather than the American market, which is volume-driven.

High-end positioning…Sintex has positioned itself in the high-end structured shirtings. It has an integrated plantwith a current capacity of 24m meters, which can manufacture high-end niche fabricsthat are used by leading fashion brands for their shirtings. We believe the business modelis superior to a normal textile player, who relies a lot on volumes and generally works onlow EBITDA margin. However, since Sintex’s model is directed towards high-end material,it stresses a lot on designing, even as volumes per design are lower. We believe thecurrent business is relationship focused and thus has high entry barriers, resulting in attractivemargins.

… and all facilities in place…In order to cater to a high value driven market, Sintex is integrated from the spinning to thefabrics stage and is equipped to address customer orders from as small as 600 meters to1,800 meters per design. It mainly works on jacquard and rapier looms that are equippedfor structured fabrics, which are manufactured in a variety of weaves comprising dobby,jacquard, double beam, etc.

Out of the total sales revenue, about 80% is from structured fabrics. The remaining 20%of the turnover comes from corduroy, where Sintex is the largest player in India and thethird largest in Asia. Exports constitute a substantial portion of the total corduroy sales.Here again, Sintex focuses on the high-end yarn dyed corduroy segment. Of the totalcorduroy sales, 92% comes from garmenting and the remaining from accessories likecaps, footwear and bags.

… to offer customized solutionsSintex is attractively placed to target its fashion-oriented customers, who require diverseproducts (weaves, color and finish). The company is equipped to offer customized solutionsfor orders as small as 600 meters to 1,800 meters per design. In fact, in FY06, a majorportion of company’s order size was less than 1,000 meters.

Focus on product developmentSintex is probably the only Indian textile company which relies heavily on productdevelopment. Apart from the designs it gets from its international customers (which it canuse after the patent expires), Sintex annually adds about 36,000 designs to its fabric

EBITDA margin from thetextile division is 28-30%

80% of total sales revenuecomes from structured fabrics

Sintex Industries

1910 January 2008

collection. This enables it to offer clients a wide choice as opposed to the prevailingpractice of replicating designs provided by customers.

Strong relationships in placeTie-up with Canclini: Canclini is one of the leading design and fashion players in Italy,which supplies designs and materials to fashion labels like Armani, Versace, etc. Thesedesigns are patented for that particular year and cannot be supplied to anyone else. Cancliniworks on designs for fashion, which usually come in the market within two years. Thus, alot of sampling work is required for this product (it involves lower volumes, but marginsare higher).

Tie-up with a UK player: Sintex has entered into an agreement with a reputed UK-based company for its textile division (on the lines of the Canclini tie-up). The understandingentails assistance in designing, which includes colors, structures and finishes as well aspacking products and niche client identification. The UK-based entity will train Sintexemployees to work with these fabrics and also market these products to several leadingbrands.

High realizations from tie-upsThe realizations from structured fabrics sales to Canclini and the UK manufacturer arefar higher than the normal realizations from sales to other garment manufacturers. InFY07, the realization from Canclini was 3x the average realization. The margins in thissegment are also higher than normal margins. On an EBITDA level, we believe the marginin sales to Canclini is 33-35%, while margin in normal sales is 22-24%.

Raising capacity to 29m metersSintex currently has a fully integrated capacity of 21m meters. It is in the process ofincreasing its capacity to 29m meters at a cost of ~Rs1b. The incremental capacity islikely to be used for high realization products such as women’s shirtings, jacquard andhigh-end furnishing fabrics.

TEXTILES: SALES TREND (RS B)


1.51.9

2.53.2

3.7

4.54.9

FY04 FY05 FY06 FY07 FY08E FY09E FY10E

Realization from Cancliniwas 3x the averagerealization in FY07

Sintex Industries

2010 January 2008

Key risksPrefab businessExecution and relationship risks: Prefab structures, being a service intensive business,could face execution risks. Also, relationships with state government are crucial as theseproducts are generally sold to them. While Sintex has cordial relations with the stategovernments it is currently providing to, creating relationships with other state governmentsas it expands its business could be a challenge.

New government legislations: Any government regulation curtailing the use of plasticscould be detrimental for Sintex. Any move to curtail the use of prefab for the sake ofgenerating employment for local carpenters, plumbers, etc could also prove to be detrimental.

Textiles businessRelationship-driven business: Being a high value business, the focus is more onrelationship with the vendors who require customized solutions. Thus, sustaining the currentrelationships and nurturing new relationships would be crucial.

Limited size of the market: Since this is a high-end value-driven business, its potentialto grow on volumes would be limited. The challenge would be to create differential byoffering newer and diverse set of products to its customers in order to maintain the nicheand generate higher realizations.

Sintex Industries

2110 January 2008

Capital raising to support future growth

Sintex is experiencing high growth in prefab and monolithic businesses and has potentialacquisition targets. To fund these, Sintex is planning to raise US$450m by March 2008through preferential allotment to promoters, QIP, and FCCB issue. We have factored thisin our model.

CAPITAL RAISING OF US$450MNO OF EQUITY RESERVES LIKELY YEAR

SHARES OF DILUTIONPreferential to Promoters - US$150m @ Rs454 13.1 26 5,899 FY08QIP - US$150m @ Rs600 9.9 20 5,905 FY08FCCB - US$150m @ Rs800 7.4 15 5,910 FY10

61 17,714Total Capital Raising (US$m) 450Total Capital Raising (Rs m) 17,714Total Dilution (%) 25.2


Promoters to pump in US$150m...Currently, the promoters own 35% in Sintex. The promoters are subscribing to a similarproportion in the new capital raising (US$150m at Rs454 per share) to maintain theirshareholding.

...QIP and FCCB to raise US$300m...The total capital raising would be US$300m through the QIP and FCCB route. In ourestimates, we are assuming the QIP money (US$150m) to be raised at Rs600 per shareand FCCB (US$150m) to have a convertible price of Rs800 per share over the next fiveyears.

We are factoring in promoters and QIP dilution in FY08 and FCCB dilution in FY10,However, we are not accounting for any gains from a likely acquisition, which themanagement is targeting through the FCCB funds. We believe the management has atrack record of executing acquisitions at reasonable costs, entailing a fast payback (3-4years) at prices that imply an expectation of payback in 3-4 years.

...to fund acquisitions and monolithic businessSintex is raising capital mainly to fund its monolithic and prefab businesses and newacquisitions. Both prefab and monolithic businesses require huge working capital (workingcapital cycle of >4 months). We anticipate huge growth in sales over the next 2-3 years,which means the company would require high working capital. Funds would also be requiredfor its ongoing capital expenditure and integration of the acquisitions done in FY08.

Sintex to raise US$450mby March 2008

Sintex Industries

2210 January 2008

CAPEX SCHEDULE (RS M) AMOUNT PURPOSETextile Capex 1,500 Expansion of capacity from 21m meter to 29m meterPlastic Capex

Capex A 3,200 Expansion of custom moulding business & electrical facilityCapex B 3,500 Mass housing/monolithic - expansion of businessCapex C 1,100 Expansion of prefab facility

Zeppelin CapexCapex A 500 New units - expansionCapex B 500 For acquisition

Wausaukee CapexCapex A 750 Expansion

Nief Capex 1,500 Acquisition, margin expansion and labor reduction exp.Bright Capex 1,000 Integration with Nief Plastic and expansionTotal Capex 13,550


New acquisitions plannedWe believe the management has plans to acquire large size companies, which would giveSintex a wider geographical presence and product focus in the plastics space. However,the management continues to be conservative in this regard and would do a full duediligence before acquiring any asset/company, even if it delays the whole process. Whilethis could lead to delays, we believe the risks of getting any wrong assets are reducedsignificantly.

Sintex Industries

2310 January 2008

12.0

15.0

18.0

21.0

24.0

FY05 FY06 FY07E FY08E FY09E FY10E0.0

4.0

8.0

12.0

16.0PAT Margin (%) - RHS EBITDA Margin (%)

0

15,000

30,000

45,000

60,000

FY05 FY06 FY07E FY08E FY09E FY010E0.0

4.0

8.0

12.0

16.0

Net Sales (Rs m) - LHS PAT (Rs m) - LHS PAT Margin (%) - RHS

Financials and valuations

Consolidation from 3QFY08; FY09 to be full year of consolidationSintex has concluded five acquisitions over the last 12 months and post all regulatoryclearances, 3QFY08 would be the first quarter of consolidation. We understand that4QFY08 would be the first full quarter of consolidation and FY09 would be the full year ofconsolidation. As all acquisitions are profit making and earnings accretive, this wouldmean strong traction in revenues and earnings.

SALES AND PAT: STRONG GROWTH AHEAD


Margins likely to improve from FY09We expect positive margin trend post FY08, led by increased capacity utilization acrossbusinesses (prefab, monolithic, and custom moulding). Also, better leverage of acquisitionsand increased outsourcing should result in higher margins for its global plants. We expectEBITDA margin to increase from 16% in FY08 to 20% in FY10. Net profit margin isexpected to increase from 10% in FY08 to 13.5% in FY10.

MARGINS TO IMPROVE


EBITDA margin to increasefrom 16% in FY08 to

20% in FY10

Sintex Industries

2410 January 2008

Cash flows to turn positive from FY10Currently, the company requires cash to fund acquisitions and working capital. It has beenraising debt through various subsidiaries and is also in the process of raising capital to fundits growth. We envisage huge capital requirement in FY08 and FY09. However, fromFY10, as most businesses grow fast, we estimate free cash flows from present businesses.

65% CAGR in sales over FY07-10Without factoring in any acquisitions, we expect a 65% CAGR in sales, driven by textiles(16% CAGR) and plastics (77% CAGR). With margins expected to improve (plasticsmargins to improve; textile margins to remain steady), we expect a 75% CAGR in earningsover FY07-10.

Earnings upgraded to factor in new businesses and acquisitionsWe have significantly upgraded our earnings estimates to factor in new businesses andacquisitions. We expect Sintex to report a PAT of Rs4.8b in FY09 and Rs7.1b in FY10.This would translate into an EPS of Rs33 in FY09 and Rs47 in FY10 (fully diluted).

Valuing at 22x FY10E EPS fully diluted; BuyWe estimate Sintex to report an EPS of Rs33 in FY09 and Rs47 in FY10, assuming fulldilution of FCCBs in FY10. We assign a 22x FY10E target multiple to arrive at our 18-month target price of Rs1,030. We are not factoring in gains from any future acquisition,which is likely over the next 6-12 months. Reiterate Buy.

Sintex Industries

2510 January 2008

Company background

Sintex Industries is a dominant player in plastics and high end textiles. Over the last fewyears, it has entered into new businesses like monolithic construction, auto plastics andelectric plastics. It is a professionally managed company promoted by the Patel family.Earlier Warburg Pincus was a majority shareholder (~25%). Currently the shareholding iswell diversified among local and global institutions.

The company started its textile business in 1955 with a composite textile mill in Kalol,Gujarat. Currently, the textile division is focused on men’s structured shirting in the premiumfashion category. Within texiltes, Sintex is a leader in the corduroy (20% of textile revenue)segment. The textile business contributes 30% of total revenue.

The plastics division, which currently contributes 70% of revenue, was set up in 1975 forthe manufacture of moulded polyethelene industrial water tanks. The product offeringexpanded in 1980s to include plastic extruded sections, plastics doors and injection mouldingproducts.

While plastics is innovation-led and volume-driven business, textiles has been a niche andhigh value business for Sintex. Over the last few years, Sintex has revamped its productprofile in both the businesses and transformed itself into a niche player from a commodityplayer. This has helped the company expand its margins and profitability.

Sintex IndustriesPlastics/Textiles

Bright Autoplastic100%Sintex USA

100%Sintex France

81%Wausaukee Composites

100%NIEF Plastic

74%Zeppelin BTS/Cole Chain

100%Sintex Netherlands

ORGANIZATIONAL STRUCTURE


Sintex Industries

2610 January 2008

BUSINESS PROFILE OF SINTEX

Sintex Industries Ltd

Plastic TextileZeppelin Mobile Systems

India Ltd.BT Shelter

Sintex HoldingsBV

PrefabricatedStructure

Custom Moulding& Tanks

MonolithicConstruction

Collections StructuredFabrics

Sintex FranceSAS

Nief Plastic SA Automotive Electricals

Aero space

Sintex HoldingUSA

Wausaukee Composites Inc Composite Plastics

Nero Plastic Inc.Structural Plastics

Composite Components

Bright Auto Plastic Pvt. Ltd.Automotive Components

Source: Company

Sintex Industries

2710 January 2008

BRIGHT BROTHERS – KEY CUSTOMERS

Source: Company

Source: Company

NIEF – KEY CUSTOMERS

Appendix: Customer profile of recently acquired companies

Customers - Automotive

PASSENGER CARS & TRUCKSMaruti Udyog Ltd.Hyundai Motor India Ltd.TATA Motors Ltd.Mahindra & Mahindra Ltd.Force Motors LtdFiat India Ltd.

TIER – 1 SUPPLIERSShin HanHanil Lear India Ltd.Samlip India Ltd.PinnacleVisteon AutomotiveShriram Pistons Ltd.Rane Brakes

TWO WHEELERHonda Motorcycles & Scooters India Ltd.Kinetic Motors Company LimitedB

righ

t Gro

up

Sintex Industries

2810 January 2008

WAUSAUKEE – KEY CUSTOMERS

Source: Company

Customer RosterCustomer Roster

Sintex Industries

2910 January 2008

INCOME STATEMENT (RS MILLION)

Y/E MARCH 2005 2006 2007E 2008E 2009E 2010ENet Income 6,587 8,534 11,653 23,603 39,215 52,363

Change (%) 24.4 29.6 36.5 102.5 66.1 33.5

Total Expenditure 5,455 7,091 9,426 19,837 32,068 41,852

EBITDA 1,132 1,443 2,227 3,766 7,147 10,512

Margin (%) 17.2 16.9 19.1 16.0 18.2 20.1

Depreciation 283 311 420 530 630 800

Int. and Finance Charges 249 291 415 575 675 825

Other Income - Rec. 105 298 269 335 425 490

PBT before EO Items 706 1,139 1,661 2,996 6,267 9,377

Extra Ordinary Expense 38 0 0 0 0 0

PBT but after EO Exp. 668 1,139 1,661 2,996 6,267 9,377

Tax 205 202 325 659 1,504 2,250

Tax Rate (%) 30.7 17.7 19.6 22.0 24.0 24.0

Reported PAT 463 937 1,336 2,337 4,763 7,126

Minority Interest 6.7 40.0 50.0 65.0

Consolidated PAT 490 937 1,329 2,297 4,713 7,061

Change (%) 44.8 91.4 41.8 72.8 105.2 49.8

Margin (%) 7.4 11.0 11.4 9.7 12.0 13.5

E: MOSt Estimates

Sintex Industries

3010 January 2008

BALANCE SHEET (RS MILLION)

Y/E MARCH 2005 2006 2007E 2008E 2009E 2010EEquity Share Capital 185 197 222 287 287 302

Preference Share Capital 0 0 0 0 0 0

Reserves 3,237 4,297 6,308 21,830 26,028 38,216

Net Worth 3,422 4,495 6,530 22,116 26,314 38,517

Loans 3,523 5,881 6,891 17,964 18,144 12,544

Deferred Liabilities 564 613 723 873 1249 1812

Capital Employed 7,510 10,989 14,144 40,953 45,707 52,872

Gross Block 5,044 6,836 8,887 17,535 20,630 23,695

Less: Accum. Deprn. 1,764 2,074 2,478 4,993 5,623 6,423

Net Fixed Assets 3,280 4,762 6,409 12,542 15,007 17,272

Capital WIP 296 190 403 350 1,250 1,500

Investments 1,675 1,568 1,886 4,540 5,040 6,040

Curr. Assets 3,781 6,280 8,423 26,454 28,171 32,665

Inventory 1,068 863 1,506 2,286 3,363 4,333

Account Receivables 1,481 1,507 2,334 4,850 7,843 10,042

Cash and Bank Balance 787 3,540 3,912 18,518 15,966 17,290

Others 445 370 671 800 1,000 1,000

Curr. Liability & Prov. 1,578 1,797 2,961 2,934 3,763 4,606

Account Payables 1,578 1,797 2,961 2,934 3,763 4,606

Net Current Assets 2,197 4,423 5,425 23,520 24,409 28,059

Misc Expenditure 61 45 21 1 1 1

Appl. of Funds 7,510 10,989 14,144 40,953 45,707 52,872

E: MOSt Estimates

Sintex Industries

3110 January 2008

RATIOS

Y/E MARCH 2005 2006 2007E 2008E 2009E 2010EBasic (Rs)

EPS 5.3 9.5 12.0 16.0 32.9 46.8

Cash EPS 3.3 5.1 15.8 19.7 37.3 52.1

BV/Share 37.0 45.6 58.9 154.2 183.5 255.4

DPS 0.8 1.2 1.6 2.2 3.5 5.0

Payout (%) 14.7 12.6 13.3 13.7 10.7 10.7

Valuation (x)

P/E 57.6 45.7 34.2 16.7 11.7

Cash P/E 108.1 34.7 27.8 14.7 10.5

P/BV 12.0 9.3 3.5 3.0 2.1

EV/EBITDA 43.7 28.6 16.0 8.8 5.3

Dividend Yield (%) 0.2 0.3 0.4 0.6 0.9

Return Ratios (%)

RoE 15.9 20.6 21.6 15.5 18.8 21.0

RoCE 13.8 15.3 16.0 12.6 15.8 20.4

Working Capital Ratios

Asset Turnover (x) 0.9 0.8 0.8 0.6 0.9 1.0

Debtor (Days) 82 64 73 75 73 70

Inventory (Days) 59 37 47 35 31 30

Leverage Ratio (x)

Debt/Equity 1.0 1.3 1.1 0.8 0.7 0.3

E: MOSt Estimates

Sintex Industries

3210 January 2008

CASH FLOW STATEMENT (RS MILLION)

Y/E MARCH 2005 2006 2007E 2008E 2009E 2010EOperating C.Flow bef. W.Cap Changes 1,161 1,588 2,281 3,592 6,444 9,314

(Inc)/Dec in Working Capital -282 456 -632 -3,682 -3,651 -2,610

Cash flow from Operations bef. EO 879 2,045 1,649 -90 2,793 6,704

Ex. Ordinary (Exps)/Income 0 0 0 0 0 0

Cash flow from Operations aft. EO 879 2,045 1,649 -90 2,793 6,704

% of net sales 13 24 14 0 7 13

(Inc)/Dec in FA -523 -1,688 -2,279 -6,611 -3,995 -3,315

(Inc)/Dec in Invst. -1,106 106 -317 -2,654 -500 -1,000

Cash flow from Investing -1,629 -1,581 -2,596 -9,265 -4,495 -4,315

Inc./(Dec) in Debt 398 2,442 1,064 11,073 180 -5,600

Inc./(Dec) in Equity 39 13 25 65 0 15

Inc./(Dec) in Share premium 1,197 156 766 13,540 0 5,910

Interest Paid -249 -291 -415 -575 -675 -825

Dividend Paid (Including Dividend Tax) -49 -84 -101 -126 -355 -565

Cash flow from financing 1,336 2,236 1,339 23,977 -850 -1,065

Opening Balance 192 787 3,540 3,912 18,518 15,966

Net +/(-) in Cash & Cash Equivalent 601 2,748 413 14,585 -2,552 1,324

Closing Balance 788 3,541 3,912 18,518 15,966 17,290

Free Cash Flow 362 411 -654 -6,737 -1,202 3,389

E: MOSt Estimates

Sintex Industries

3310 January 2008

N O T E S

Sintex Industries

3410 January 2008

N O T E S

Sintex Industries

3510 January 2008

N O T E S

Sintex Industries

3610 January 2008

This report is for the personal information of the authorized recipient and does not construe to be any investment, legal or taxation advice to you. Motilal OswalSecurities Limited (hereinafter referred as MOSt) is not soliciting any action based upon it. This report is not for public distribution and has been furnished to you solelyfor your information and should not be reproduced or redistributed to any other person in any form.

The report is based upon information that we consider reliable, but we do not represent that it is accurate or complete, and it should not be relied upon such. MOSt orany of its affiliates or employees shall not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the informationcontained in this report. MOSt or any of its affiliates or employees do not provide, at any time, any express or implied warranty of any kind, regarding any matterpertaining to this report, including without limitation the implied warranties of merchantability, fitness for a particular purpose, and non-infringement. The recipients ofthis report should rely on their own investigations.

MOSt and/or its affiliates and/or employees may have interests/ positions, financial or otherwise in the securities mentioned in this report. To enhance transparency,MOSt has incorporated a Disclosure of Interest Statement in this document. This should, however, not be treated as endorsement of the views expressed in the report.

Disclosure of Interest Statement Sintex Industries1. Analyst ownership of the stock Yes2. Group/Directors ownership of the stock No3. Broking relationship with company covered No4. Investment Banking relationship with company covered Yes

This information is subject to change without any prior notice. MOSt reserves the right to make modifications and alternations to this statement as may be requiredfrom time to time. Nevertheless, MOSt is committed to providing independent and transparent recommendations to its clients, and would be happy to provideinformation in response to specific client queries.

For more copies or other information, contactInstitutional: Navin Agarwal. Retail: Manish Shah

Phone: (91-22) 39825500 Fax: (91-22) 22885038. E-mail: [email protected]

Motilal Oswal Securities Ltd, 3rd Floor, Hoechst House, Nariman Point, Mumbai 400 021

“This document has not been prepared by or in conjunction with or on behalf of or at the instigation of, or by arrangement with Sintex Industries Ltd or any of itsdirectors and/or senior management. This document has been prepared by Motilal Oswal Securities Ltd to provide background information about the Company. It hasbeen produced independent of the Company, and the forward-looking statements, opinions and projections contained herein are entirely those of the authors. Anyinformation or statement in this document must not be relied upon as having been authorised or approved by the Company or its directors or any other person relatedthereto. Accordingly neither the Company, any underwriter of securities of the Company, or any of their respective directors, officers, employees or any other personrelated thereto, shall be in any way responsible for the contents hereof, or shall be liable for any loss arising from use of this document or otherwise arising inconnection therewith. If the Company should at any time commence an offering of securities, any decision to invest in any such offer to subscribe for or acquiresecurities of the Company must be based wholly on the information contained in an offer document issued or to be issued by the Company in connection with anysuch offer and not on the contents hereof. The reader is cautioned that the actual results may differ materially from those set forth in any forward-looking statements,opinions and projections contained herein. While all reasonable care has been taken to ensure that the facts stated herein are accurate and that the forward-lookingstatements, opinions and projections contained herein are based on fair and reasonable assumptions, the authors have not been able to verify independently suchfacts or assumptions and neither the authors nor any of their affiliates shall be liable for the accuracy thereof.”

Documents

Sintex Industries Meet/102742_20080110.pdfSTOCK DATA 52-Week Range (Rs) 615/185 Major Shareholders (September 2007)(%) Promoters 31.3 Domestic Institutions 10.8 FIIs/FDIs 21.7 Others