Download - Alkem Laboratories Limited (ALKEM)€¦ · Market ap. (₹ mn.) 1,61,413 Alkem Laboratories Limited (ALKEM) NOTE: Company has recently got listed through IPO on exchanges thus previous

Anand Rathi Research

Time Horizon – 12 Months

March 17, 2016

Dec-15 Sep-15 Jun-15 Mar-15

Promoter 66.6% - - -

Institutions 6.0% - - -

Non Institutions 27.3% - - -

Total 100% - - -

Source: Company, Anand Rathi Research, Bloomberg

V

A

L

U

E

P

I

C

k

(In ₹ Mn.) FY14 FY15 FY16E FY17E

Net Sales 31,260 37,832 48,770 59,792

EBITDA 4,100 4,845 8,657 10,912

EBITDA Margin 13.1% 12.8% 17.8% 18.3%

EPS (₹) 36.4 38.5 63.8 80.4

EV/Sales 5.2 4.3 3.3 2.7

EV/EBITDA 28.1 24.3 15.2 12.2

P/E (x) 37.1 35.0 21.2 16.8

Price Performance CY13 CY14 CY15 YTD

Absolute - - 41% -9%

Relative - - 46% -4%

Analyst: Narendra [email protected]

Relative stock performance (Dec’15=100)

CMP: ₹1,350

Target: ₹1,720

Shareholding Pattern (as on Dec’15)

Key Data

Bloomberg Code ALKEM IN

NSE Code ALKEM

BSE Code 539523

Sector Healthcare

Industry Pharmaceuticals

Face Value (₹) 2.0

BV per share (₹) 251

Dividend Yield (%) 0.7%

52 Week L/H(₹) 1232 / 1589

Market Cap. (₹ mn.) 1,61,413

Alkem Laboratories Limited (ALKEM)

NOTE: Company has recently got listed through IPO on exchanges thus

previous shareholding is not applicable.80

90

100

110

120

Dec-15 Jan-16 Feb-16 Mar-16

Nifty ALKEM

2 Anand Rathi Research

Alkem Laboratoties , established in 1973 began operations as a healthcare marketing company. It is one of the India’s significant player in thebranded drugs and generic drugs space. The company has wide ranging presence across acute and chronic therapeutic segments with substantialbrand share in the Anti-infective , Gastro-intestinal, Pain Management , Vitamins / Minerals / Nutritions, Central Nervous System, Anti-diabetic,Anti-osteoporosis, Anti-malarial, Cardiovascular, Immunosuppressants, and Nutraceutical segments.

Alkem has in total 16 manufacturing facilities; 14 manufacturing facilities in India and two in the United States. Five of its facilities are USFDA, TGAand UK-MHRA approved. Of the Indian manufacturing facilities, 12 are for manufacturing formulations and two for manufacturing APIs. Thecompany also has four research and development facilities, two in India and two in the United States.

Alkem’s pharmaceutical business is organized into domestic and international operations. For fiscal year 2015, its domestic and internationaloperations accounted for ~74% and ~26%, respectively. It markets its products in 56 countries internationally.

In domestic business, the company has a portfolio of a portfolio of more than 700 brands. Alkem has also the largest number of brands (five) in thetop 50 brands of the Indian pharmaceutical industry for fiscal year 2015.

The company’s business is largely dominated by acute segment namely anti-infectives, gastro-intestinal, pain and analgesics, and vitamins, mineralsand nutrients. These therapeutic areas accounted for ~80% of its domestic sales while in chronic segment the company has lately increased focuson developing portfolio in areas such as neuropsychiatry, cardio, dermatology, diabetology and oncology. It has already built few brands like Olkemfor hypertension, Donep for Alzheimer’s disease, Glucoryl-M for diabetes, Kojiglo for hyper-pigmentation and Melbild for hypo-pigmentation etc.

In international business, the company sells its products in 56 countries, either directly through its subsidiaries or indirectly through supply,distribution and arrangements with various global companies and local distributors. Of the total international business, United States is the majormarket for the company contributing almost 75% to its sales followed by Australia, Europe, South-East Asia, Latin America, Africa and the CIS.

In U.S. the company has filed 70 abbreviated new drug applications (“ANDAs”) (of which 24 have received final approval and three have receivedtentative approval), of which 30 are Para IV filings including first-to-files “FTFs”) and one new drug application (“NDA”).

Going ahead, the management expects to increase its business in both domestic as well as international markets through introduction of newbranded formulations/ generic in its respective markets. We believe Alkem has significant potential to increase its international business based onits regulatory filings while indian business to continue to post higher growth on back of new product launches and increased focus on chronicsegment.

We expect Alkem’s consolidated revenues to grow at a CAGR of ~26% in the next two years and thus initiate our coverage on the stock with a BUYrating and a target price of ₹1,720 per share.

A promising branded generics play in international market along with a strong domestic business franchise



History:


Year Event1973 Alkem Laboratories Limited was incorporated1978 Established its first plant at Taloja, Mumbai

1992 Established its manufacturing facility in Mandwa, Maharashtra. This facility was converted into an API facility in 2005.

2003 Set up research and development facility for ANDA development at Taloja.

2006Its anti-infective drug Taxim became the first anti-infective drug in the Indian pharmaceutical industry to cross ₹1,000 million in terms of domestic sales in India. (Source: IMS Health)

2007 Filed its first ANDA in the United States for the drug Amlodipine.

2009 Received its first ANDA approval in the United States for Amlodipine.

2009 Acquired Pharmacor Pty Ltd., a generic pharma company in Australia.

2010 Acquired Ascend Laboratories, a generic marketing company in the US.

2011 Acquired Enzene, a company engaged in the development of biosimilars in India.

2012 Acquired an API manufacturing facility in the United States.

2014 Acquired the “Clindac-A” brand in India

2014 Clavam crossed `2,000 million in terms of domestic sales in India (Source: IMS SSA MAT March 2015).

2015 Acquired a formulation manufacturing facility in the United States.

2015 Listed on NSE & BSE through IPO.


Corporate Profile:


India Business International Business

Alkem Laboratories Ltd.

U.S. (ThePharmanetwork LLC)

Australia (Pharmacor

Pty Ltd)

Chile (Ascend Laboratories

SpA)

Philippines (Alkem

Laboratories Corp.)

Kazakhastan(The Pharma

Network)

~74% ~26%

Source: Company, Anand Rathi Research

~20%


Alkem has in past three financial years reported an average growth of 23.4% in its revenues. The higher growthwas on back of both domestic business as well as international business. The company’s domestic businesscontributes around 73% to its topline while international business contributes the remaining 27%.

In latest financial quarterly results the company’s 9M-FY16 revenues grew by ~36% at Rs.38,490 million as againstRs.28,314 million in 9M-FY15. Its domestic business during the period grew by ~33% while international businessgrew by ~46%.

On profitability front, the company has reported a significant improvement in its operating margins and hasreported EBITDA margins of 17.9% in 9M-FY16 at Rs.6,902 million as against 10.1% margin in 9M-FY15 at Rs.2,872million.

Historical financial performance has been fairly decent followed by margins improvement…

Sales (₹ Mn.) & Sales Growth EBITDA (₹ Mn.) & EBITDA margins


Source: Company, Anand Rathi Research Source: Company, Anand Rathi Research

10%

15%

20%

25%

30%

35%

40%

0

10000

20000

30000

40000

FY-13 FY-14 FY-15 9M-FY16

Domestic International Sales growth (RHS)

0%

5%

10%

15%

20%

-

1,500

3,000

4,500

6,000

7,500

Mar-13 Mar-14 Mar-15 9M-FY16

EBITDA EBITDA Margins


…on back of strong brand presence and well spread across various therapies.


Anti-Infectives, 42%

Gastro Intestinal, 18%

Pain/ Analgesics,

12%

Vitamins, 8%

Cardiac & Diabetes, 4%

Gynae, 4%

Neuro, 3%

Derma, 3% Others, 6%

Alkem’s Therapy Wise Sales Breakup

Names of Brands Number of Brands Sales Range ₹Mn.

Clavam, Taxim-O, Taxim 3 Above 1,500

Pan, Pan D 2 1,000 – 1,499

Gemcal, A to Z NS, Sumo, Ondem, Xone

5 500 – 999

Swich, Zocef, Xone-XP, Pipzo, Hemfer, Uprise-D3, Traxol, Cheri, Enzoflam, Taximax, Indclav, Traxol-S

12 250 – 499



Alkem’s domestic formulations business is predominantly focused on acute therapy segment in linewith the Indian pharmaceutical market which is approximately 70% acute while remaining 30% ischronic therapy.

However lately the company has started to increase its presence in chronic therapy segmentthrough increased new product launches and expanding geographical footprint.

Alkem’s major brands in India


Making itself one of the top five large companies in IPM


Indian Pharma Market (IPM) top companies Market Share


The domestic formulations market is highly fragmented, and the top 10 pharmaceutical companiesaccounted for 43% of the market share for the fiscal year 2015, with the market leader accountingfor 8.4% of the market share in the same period.

Alkem is one of the top five companies in terms of sales in domestic markets and is the onlycompany having most number of brands listed in brands over ₹1,500 million annual sales.

0%

8%

15%

23%

30%

2%

4%

6%

8%

10%

Market Share (FY-15) CAGR (FY11-15) -RHS

Therapy wise domestic sales ₹Mn 2009 2014 2019 CAGR (‘14-19)

Alimentary tract and metabolism 98,196 2,06,096 4,02,200 14.3%

Blood and blood-forming organs 17,625 32,535 60,125 13.1%

Cardiovascular system 42,893 85,248 1,54,396 12.6%

Dermatologicals 19,585 44,192 80,736 12.8%

Genito-urinary system and sex hormones 18,239 33,777 55,065 10.3%

Anti-infectives for systemic use 82,222 1,27,436 2,09,556 10.5%

Antineoplastic and immunomodulating agents 3,672 9,571 22,462 18.6%

Musculo-skeletal system 23,781 40,127 70,485 11.9%

Nervous system 28,597 56,883 1,05,627 13.2%

Respiratory system 35,881 61,898 1,09,776 12.1%

Various 30,382 58,097 96,035 10.6%



On therapy wise, Indian pharmaceuticals market (IPM) continues to be dominated by acute segment than chronicsegment.

However, in terms of growth acute is expected to moderate as preventive healthcare and improving lifestyleimproves along with higher base while chronic segment looks promising.

Looking at global pharmaceutical sales of top therapeutic classes, chronic segment is the major contributor andthis should be the case for India once its demographic distribution shifts towards older age in next decade.

IPM continues to dominated by acute therapy in India…


Source: Company, IMS Market Prognosis 2015-19 Source: Company, Anand Rathi Research

Top 20 therapeutic classes by global pharmaceutical sales in 2014 ($ Bn.)

0%

2%

4%

6%

8%

10%

12%

On

colo

gics

An

tid

iab

etic

s

Pai

n

An

tih

yper

ten

sive

An

tib

acte

rial

s

Res

pir

ato

ry

Men

tal H

ealt

h

Au

toim

mu

ne

Dis

eas

e

Lip

id R

egu

lato

rs

Der

mat

olo

gics

An

tico

agu

lan

ts

GI P

rod

uct

s

An

ti-U

lce

ran

ts

HIV

An

tivi

rals

Oth

er

Car

sio

vasc

ula

rs

Ne

rvo

us

Syst

em D

iso

rder

s

Oth

er

CN

S

Vir

al H

epat

itis

Kan

po

, Ch

ines

e M

edic

ine

s

Vac

cin

es (

Pu

re, C

om

b,…

Acute69%

Chronic31%

Market Share by Therapeutic segment (IPM) (FY15)


In terms of distribution of expenses within public and private, mature economies tends to havehigher public expenditure and lower private expenditure.

For India, currently private expenditure in healthcare is significantly higher even when comparedwith emerging economies.

We believe this anomaly to slowly shift towards in favour of public in medium to long term.

…with higher private expenditure. A trend expected to shift to a more balanced share between both.

Percentage of public and private health expenditure in selected countries in 2012


Country Private Public

UK 16% 84%

Japan 17% 83%

France 23% 77%

Turkey 23% 77%

Germany 23% 77%

Spain 28% 72%

China 44% 56%

Russia 49% 51%

Brazil 53% 48%

India 70% 31%

Source: Company, IMS Market Prognosis 2015-19 Source: Company, Anand Rathi Research

• Increasing Population• Increasing disposal income• Increasing Govt.

expenditure.• Social security commitments• Increasing Insurance

Coverage• Growth in Lifestyle Related

Diseases

Growth drivers for IPM


Small molecules continues to dominate in terms of share for global sales at risk of patent expiry between 2015-2025 with a 47% share followed by biologics at 33%, device associated patents 19% and vaccines at 1%.

Majority of the global sales at risk in next three years are from small molecules and only from 2018 biologicsshare leads.

We believe the global generic market continues to remain robust despite the patent cliff achieved in past fewyears. The patent expirations timeline still remains exploitable by the likes of Alkem in order to achieve highergrowth in international business.

Global patent expiry based generics business still significant in medium term…

Global sales at risk, yearly ($ mn.) % of Global Sales At Risk: 2015 - 2025


Source: Company, Anand Rathi Research , Bloomberg

Source: Company, Anand Rathi Research, Bloomberg

0

12000

24000

36000

48000

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Small Molecule Biologic Device Associated Vaccine

Small Molecule47%

Biologic33%

Device Associated

19%

Vaccine1%


Alkem has so far build up healthy pipeline of filings in its U.S. and other international businesses. For U.S.business its current ANDA filings stood at 70 of which 24 has received final approvals while 3 have receivedtentative approvals.

In terms of ANDAs by type, Alkem’s para IV filing (including first to file) stood at 30 followed by DMF at 18 andone NDA filing.

Of the other international markets, the company’s filing in Australia and Europe MAA stood at 22 and 16respectively of which 18 and 7 have been approved.

…presenting greater growth opportunities for Alkem

Alkem’s U.S. ANDA Filings Alkem’s Other applications in international markets


ANDA Filings Count

Final Approvals 24

Tentative Approvals 3

Pending 43

Total 70

ANDAs by Type Count

Para IV (incl. FTF) 30

DMF 18

NDA 1

Total 70

Country Filed Approved

Australia 22 18

Europe MAA 16 7

Philippines (Dossiers for each strength) 55 51

Chile (Dossiers for each strength) 110 69

Kazakhstan (Dossiers for each strength) 66 52

Other Countries (Dossiers for each strength) 1166 743

Source: Company, Anand Rathi Research Source: Company, Anand Rathi Research


…translating into higher growth in years ahead.

We expect Alkem’s revenues to grow at a CAGR of ~26% in next two financial years on the back of higher growth

in both domestic and international business.

We expect Alkem’s traditional domestic business to grow at market rate while new launches in non traditional

therapy segment to bring in additional outperformance in medium term.

On impending regulatory uncertainty regarding fixed dosage combination, we have accounted for about ₹700

million sales coming under notification.


Sales (₹ Mn.) & EBITDA Estimates


0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

FY-13 FY-14 FY-15 FY-16E FY-17E

Sales EBITDA Margin


A promising international business based on

proven branded generics play coupled with

strong domestic business franchise.

In domestic business, focus on increasing

revenues from chronic therapy segment and

new product launches to drive growth.

Higher institutional sales through new

government schemes and stabilising margins at

current levels to improve valuation multiples.

At CMP the stock is trading at 21x FY-16E and

17x FY17E earnings.

We initiate our coverage on the stock with a

BUY rating and a target price of ₹1720 per

share.

Relative stock performance (Dec’15=100)

Valuation and Recommendation:

Source: Bloomberg, Anand Rathi Research


(In ₹ mn) FY-14 FY-15 FY-16E FY-17E

EPS (₹) 36.4 38.5 63.8 80.4

P/E (x) 37.1 35.0 21.2 16.8

P/B (x) 6.2 5.4 4.3 3.4

ROE 16.8% 15.3% 20.2% 20.3%

ROCE 14.0% 20.8% 26.6% 26.8%

EV/EBIDTA (x) 28.1 24.3 15.2 12.2


80

90

100

110

120


Nifty ALKEM


Margins FY-14 FY-15 FY-16E FY-17E

Sales Growth % 25.3% 21.0% 28.9% 22.6%

Operating Margin % 13.1% 12.8% 17.8% 18.3%

Net Margin % 13.9% 12.2% 15.6% 16.1%

Consolidated Financials:


(In ₹ Mn.) FY-14 FY-15 FY-16E FY-17E

Liabilities

Equity Share Capital 120 239 239 239

Reserves & Surplus 25,730 29,787 37,411 47,019

Total Shareholder's Funds 25,850 30,026 37,650 47,259

Minority Interest - 857 929 929

Long-Term Liabilities 2,323 334 736 736

Other Long-term Liabilities 501 717 868 868

Deferred Tax Liability 416 919 753 753

Short-term Liabilities 14,026 20,060 18,560 22,754

Total 43,115 52,913 59,495 73,299

Assets

Net Fixed Assets 11,700 14,850 16,266 18,137

Long-Term L&A 4,184 5,422 6,198 6,198

Non Current Investments 3,382 4,197 4,155 4,155

Other Non-Current Assets 7,827 5,063 4,234 4,234

Current Asset 16,021 23,381 28,643 40,575

Total 43,115 52,913 59,495 73,299

(In ₹ Mn.) FY-14 FY-15 FY-16E FY-17E

Net Sales 31,260 37,832 48,770 59,792

Operating Expense 27,161 32,986 40,113 48,880

EBITDA 4,100 4,845 8,657 10,912

Other Income 1,654 1,810 1,951 2,392

Depreciation 523 703 813 854

EBIT 5,230 5,953 9,795 12,450

Interest 931 811 665 803

Misc. items - - - -

PBT 4,300 5,142 9,130 11,647

Tax (54) 534 1,506 2,038

Minority Interest - - - -

PAT 4,353 4,607 7,623 9,609



The company’s business is highly regulated and strict quality constraints are imposed by various countries and

thus any abrupt removal of any of its plants could impact our projections.

Company is exposed to currency exchange risk.

The company is exposed to sector wide regulatory uncertainty in its domestic business on back of recent

notification by Department of Pharmaceuticals on banning some fixed dosage combination (FDC) drugs in India. It

has been observed from media reports that department is considering to release another list in near future for

the same.

Key Risks:



Rating and Target Price history:

Date Rating Target Price (₹) Share Price (₹)

17-Mar-16 BUY 1,720 1350

ALKEM rating detailsALKEM rating history & price chart

Source: Bloomberg, Anand Rathi Research Source: Bloomberg, Anand Rathi Research

NOTE: Prices are as on 17th Mar 2016 close.


80

90

100

110

120


Nifty ALKEM


Disclaimer:

Research Disclaimer and Disclosure inter-alia as required under Securities and Exchange Board of India (Research Analysts) Regulations, 2014

Anand Rathi Share and Stock Brokers Ltd. (hereinafter refer as ARSSBL) (Research Entity, SEBI Regn No. INH000000834, Date of Regn. 29/06/2015) is a subsidiary of the

Anand Rathi Financial Services Ltd. ARSSBL is a corporate trading and clearing member of Bombay Stock Exchange Ltd, National Stock Exchange of India Ltd. (NSEIL),

Multi Stock Exchange of India Ltd (MCX-SX), United stock exchange and also depository participant with National Securities Depository Ltd (NSDL) and Central

Depository Services Ltd. ARSSBL is engaged into the business of Stock Broking, Depository Participant, Mutual Fund distributor.

The research analysts, strategists, or research associates principally responsible for the preparation of Anand Rathi Research have received compensation based upon

various factors, including quality of research, investor client feedback, stock picking, competitive factors, firm revenues.

General Disclaimer: - This Research Report (hereinafter called “Report”) is meant solely for use by the recipient and is not for circulation. This Report does not

constitute a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual clients. The

recommendations, if any, made herein are expression of views and/or opinions and should not be deemed or construed to be neither advice for the purpose of

purchase or sale of any security, derivatives or any other security through ARSSBL nor any solicitation or offering of any investment /trading opportunity on behalf of

the issuer(s) of the respective security (ies) referred to herein. These information / opinions / views are not meant to serve as a professional investment guide for the

readers.No action is solicited based upon the information provided herein. Recipients of this Report should rely on information/data arising out of their own

investigations. Readers are advised to seek independent professional advice and arrive at an informed trading/investment decision before executing any trades or

making any investments. This Report has been prepared on the basis of publicly available information, internally developed data and other sources believed by ARSSBL

to be reliable. ARSSBL or its directors, employees, affiliates or representatives do not assume any responsibility for, or warrant the accuracy, completeness, adequacy

and reliability of such information / opinions / views. While due care has been taken to ensure that the disclosures and opinions given are fair and reasonable, none of

the directors, employees, affiliates or representatives of ARSSBL shall be liable for any direct, indirect, special, incidental, consequential, punitive or exemplary

damages, including lost profits arising in any way whatsoever from the information / opinions / views contained in this Report. The price and value of the investments

referred to in this Report and the income from them may go down as well as up, and investors may realize losses on any investments. Past performance is not a guide

for future performance. ARSSBL does not provide tax advice to its clients, and all investors are strongly advised to consult with their tax advisers regarding taxation

aspects of any potential investment.

Continued…



Disclaimer:

Contd…

Opinions expressed are our current opinions as of the date appearing on this Research only. We do not undertake to advise you as to any change of our views expressed in this Report. Research Report may differ between ARSSBL’s RAs and/ or ARSSBL’s associate companies on account of differences in research methodology, personal judgment and difference in time horizons for which recommendations are made. User should keep this risk in mind and not hold ARSSBL, its employees and associates responsible for any losses, damages of any type whatsoever.

ARSSBL and its associates or employees may; (a) from time to time, have long or short positions in, and buy or sell the investments in/ security of company (ies) mentioned herein or (b) be engaged in any other transaction involving such investments/ securities of company (ies) discussed herein or act as advisor or lender / borrower to such company (ies) these and other activities of ARSSBL and its associates or employees may not be construed as potential conflict of interest with respect to any recommendation and related information and opinions. Without limiting any of the foregoing, in no event shall ARSSBL and its associates or employees or any third party involved in, or related to computing or compiling the information have any liability for any damages of any kind.

Details of Associates of ARSSBL and Brief History of Disciplinary action by regulatory authorities & its associates are available on our website i. e. www.rathi.com

Disclaimers in respect of jurisdiction: This report is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation or which would subject ARSSBL to any registration or licensing requirement within such jurisdiction(s). No action has been or will be taken by ARSSBL in any jurisdiction (other than India), where any action for such purpose(s) is required. Accordingly, this Report shall not be possessed, circulated and/or distributed in any such country or jurisdiction unless such action is in compliance with all applicable laws and regulations of such country or jurisdiction. ARSSBL requires such recipient to inform himself about and to observe any restrictions at his own expense, without any liability to ARSSBL. Any dispute arising out of this Report shall be subject to the exclusive jurisdiction of the Courts in India.

Copyright: - This report is strictly confidential and is being furnished to you solely for your information. All material presented in this report, unless specifically indicated otherwise, is under copyright to ARSSBL. None of the material, its content, or any copy of such material or content, may be altered in any way, transmitted, copied or reproduced (in whole or in part) or redistributed in any form to any other party, without the prior express written permission of ARSSBL. All trademarks, service marks and logos used in this report are trademarks or service marks or registered trademarks or service marks of ARSSBL or its affiliates, unless specifically mentioned otherwise.

Contd…



Disclaimer:

Contd.

Statements on ownership and material conflicts of interest, compensation - ARSSBL and Associates

Sr. No.

Statement

Answers to the Best of the knowledgeand belief of the ARSSBL/ itsAssociates/ Research Analyst who ispreparing this report

1ARSSBL/its Associates/ Research Analyst/ his Relative have any financial interest in the subject company? Nature of Interest (if applicable), is givenagainst the company’s name?. NO

2

ARSSBL/its Associates/ Research Analyst/ his Relative have actual/beneficial ownership of one per cent or more securities of the subject company, at theend of the month immediately preceding the date of publication of the research report or date of the public appearance?. NO

3ARSSBL/its Associates/ Research Analyst/ his Relative have any other material conflict of interest at the time of publication of the research report or atthe time of public appearance?. NO

4 ARSSBL/its Associates/ Research Analyst/ his Relative have received any compensation from the subject company in the past twelve months. NO

5ARSSBL/its Associates/ Research Analyst/ his Relative have managed or co-managed public offering of securities for the subject company in the pasttwelve months.

NO

6ARSSBL/its Associates/ Research Analyst/ his Relative have received any compensation for investment banking or merchant banking or brokerageservices from the subject company in the past twelve months. NO

7

ARSSBL/its Associates/ Research Analyst/ his Relative have received any compensation for products or services other than investment banking ormerchant banking or brokerage services from the subject company in the past twelve months. NO

8ARSSBL/its Associates/ Research Analyst/ his Relative have received any compensation or other benefits from the subject company or third party inconnection with the research report. NO

9 ARSSBL/its Associates/ Research Analyst/ his Relative have served as an officer, director or employee of the subject company. NO

10 ARSSBL/its Associates/ Research Analyst/ his Relative has been engaged in market making activity for the subject company. NO
