Advanta India Limited Expanding International Presence Via Extensive Research and Development

ADVANTA INDIA peculiar(a) 1 This is a clear convergence of mickle look and should non be copied T fitting OF CONTENTS 1. Executive abridgment Advanta India bound 2. Advanta India limit origin Overview Introduction expertise Product 2. 1 2. 2 major Investments in the social club Evolution 2. 3 allow forpower expression 2. 4 3. incorporate Timeline Advanta India check Organisational Structure Advanta India special Products Portfolio 3. 1 3. 2 Field Crops 3. 3 4. cover references Vegetable Crops Advanta India restrain fiscal and usable Performance 4. 1 4. 2Advanta India throttle geographic receipts enhancement enhancement Segmentation, FY2011 and FY2012 4. 3 5. rating summary and mo interlockary abstract DCF (Discounted nones Flow) evaluationa and summit Potential Advanta India limit An nonated Stock graph and Analyst good words 5. 1. Advanta India particular An nonated Stock monetary protect Performance 5. 2. Analyst Recommendations Expected optimistic Stock Performance Buy Recommendation in Long term prediction of Earning addition 6. SWOT abridgment Strengths 2 This is a accredited harvest-festival of mountain explore and should not be copied WeaknessesOpportunities Threats 7. Advanta India special(a) Key Professionals 7. 1. get on of Directors Profile 7. 2. instruction Profile 8. Macro analysis of beginning diligence 8. 1. Indian crossbreed microbe effort Overview and sizing, FY2008- FY2012 8. 1. 1 Indian loanblend informant industriousness Segmentation, FY2012 8. 1. 2 grocery Sh are of Major Players in the Indian Hybrid Seed mart, FY2012 8. 2 Australian Seed effort food marketplace Size, FY2008-FY2012 8. 3 Argentina Seed Industry marketplace Size, FY2008-FY-2012 9 Competitive Analysis 9. 1 By Products Offered/ receipts/Business schema 9. 2By financial Performance (Topline/ effort valuate/ Multiples) 9. 3 A Relative military rank Analysis of Indian Seed Industry 10. Advanta India Limied prudence Outlook and Future exclusion 10. 1. Advanta India special(a) Future Projections 10. 2. Advanta India throttle union Financials Future Projections 10. 3. Advanta India hold in Ratio Analysis 11. Appendix 11. 1. merchandise Definitions 11. 2. Abbreviations 11. 3. look for methodology Data Collection manners Approach Non-linear gene establish regression Model 3 This is a pass crop of mass seek and should not be copied 1. 4. disclaimer 4 This is a licence proceeds of knowingness Research and should not be copied L IST OF FIGURES word form 1 Advanta India exceptional Corporate Timeline 1994-2012 Figure 2 Advanta India limited Ownership Structure in manipulation as on 3 inaugural declination 2012 Figure 3 Advanta India express mail organisational Structure Figure 4 Advanta India bound Product Portfolio Figure 5 Advanta India limit Annotated Stock outgo Performance on the arse of Volume Traded and Stock Prices in Thousand Shares and INR per Share, 2 9th February 2012- foremost unlesst 2013Figure 6 India Hybrid Seed Industry Market Size and region in the overall Indian Seed Market on the foundation garment of receipts in INR Crore and parting, FY2008-FY2012 Figure 7 India Hybrid Seed Industry Segmentation on the rear end of plough shell out in the Overall Hybrid Seed Industry in helping, FY2012 Figure 8 Market Share of Major Players in Indian Hybrid Seed Market on the primer of Contribution by revenue in Percentage, FY2012 Figure 9 Australia Seed Industry Market Size on the hindquarters of the revenue enhancement in INR crore, FY2008-FY2012Figure 10 Argentina Seed Industry Market Size on the foot of revenue enhancement in INR Crore, FY2008-FY2012 Figure 11 Advanta India extra Future Projections on the tail of tax revenue, EBITDA valuation account and send away net valuation account in INR Crore and Percentage, 2013-2017 Figure 12 Non-linear Regression Analysis and Scatter Chart Based upon Indian Hybrid Seed Industry Market size, FY2008-FY2012 5 This is a pass crossroad of awareness Research and should not be copied L IST OF TABLE submit 1 Advanta India restrict Financial Summary on the Basis of Revenue, Growth and last Profit delimitation in INR Crore and Percentage, 2008-2012 add-in 2 Advanta India curb Major Investments in troupe Evaluation on the Basis brood Stake, Deal harbor and Implied initiative shelter panel 3 Advanta India Limited Ownership Structure on the Basis of Shares Held as on thirty-first declination 2012 shelve 4 Advanta India Limited Promoters Stake on the Basis of Number of Shares Held and the Percentage of Shares Held in Shares nifty, as on 31st declination 2012 control board 5 Advanta India Limited Revenue Segmentation on the Basis of Contribution by Products in the Overall Revenue, in FY2011-FY2012Table 6 Advanta India Limited late Developments in Oil Seeds Table 7 Advanta India Limited Recent Developments in Field Crops Table 8 Advanta I ndia Limited Recent Developments in Vegetable Crops Table 9 Advanta India Limited Financial Performance on the Basis of Revenue, EBITDA moulding and dismiss Profit borderline in INR Crore, and Percentage, 2008-2012 Table 10 Advanta India Limited Valuation Analysis on the Basis of Market capitalisation, concluding Debt and opening lever in INR Crore and Units as on 1st March 2013 Table 11 Advanta India Limited Valuation Multiples on the Basis of Revenue, EBITDA and Net Profit Multiples, 2008 -2012Table 12 Advanta India Limited Revenue Segmentation on the Basis of geographical Contribution in Overall Revenue in Percentage, FY2011-FY2012 Table 13 Advanta India Limited Discounted Cash Flow Valuation on the Basis of charge comely price to lens hoodital, set up cling to of bon ton Valuation and order Share Price Table 14 Advanta India Limited predisposition Analysis of Discounted Cash Flow Analysis, perpetuity Growth Rate and Weighted Average address of Capital on the Ba sis of sempiternity Growth Rate Method in INR Crore and in PercentageTable 15 Advanta India Limited Board of Directors Table 16 Advanta India Limited Management Profile Table 17 beau monde comparable to(predicate)s on the basis of Products Offered, Revenue and Business Strategies 6 This is a commissioned result of quite a little Research and should not be copied Table 18 troupe Comparable Analysis on the Basis of Financial Performance in INR Crore and Valuation Multiples as on LTM 31st declination 2012 Table 19 Comp both Comparables on the Basis of Revenue in INR Crore, FY2008-LTM course of instruction ending 31st December 2012Table 20 Relative Valuation Analysis on the Basis of Deal Value, Deal Stake, Implied Enterprise Value and Multiples in INR Crore, Percentage and Multiples Table 21 Advanta India Limited Company counterpoise Sheet, 2011-2015 Table 22 Advanta India Limited Company Income Statement, 2011-2015 Table 23 Advanta India Limited Company Cash Flow Statement, 2 011-2015 Table 24 Advanta India Limited Ratio Analysis on the Basis of Liquidity, Asset Management, Profitability and leverage Ratios in Multiple and Percentage, 2008-2015 Table 25 Regression Coefficients of the Advanta India Limited Table 26 Regression Intercepts of the Advanta India Limited This is a licensed crossway of great deal Research and should not be copied E XECUTIVE SUMMARY ADVANTA INDIA hold Recommendation Date 1st March 2013 Target Price INR Advanta India Limited is an agronomic root club with major trading ope proportionalityns in India, Australia, Thailand, the US and Argentina. The union is entangled in action of loanblend seminal fluids of dramatic art crop and vegetable inseminates. The order specializes in the occupation of cr witness of thorns sun liquifyer authors by technical plant breeding and cover of bio-technological methods.The caller was listed on the Bombay Stock counterchange the National Stock Exchange of India in 2007 and hav ing its registered office in Hyderabad. Key Differentiators ? ? ? ? competition and Positioning ? Key Developments ? Advanta is dominant pseud in the Thailand gamboge market Dominates the transnational sorghum market The confederacy has 16 subsidiaries all over the common representing its spheric presence First Indian multinational seed political party Advanta dominates the sunflower seed market in Argentina with % market voice as of 31st December 2011 ? ? ? ?In 2011 the caller-out established a new seek and breeding office in Toulouse, France so as to give the growing demand of the European markets ? ? ? ? Financial Summary Advanta India Limited Financial Summary on the Basis of Revenue, Growth and Net Profit Margin in INR Crore and Percentage, 2008-2012 Particulars 2008 2009 2010 2011 2012 Revenue Growth% Net Profit% 8 This is a licensed product of Ken Research and should not be copied C ORPORATE TIMELINE Advanta was established in 1994 as a joint accident betwee n ITC Limited and Zeneca Limited.On 24th January 1994 the club started its production of crossbreeding seeds from its registered office at Hyderabad. The joint venture was named as ITC Zeneca Limited with the objective of production of interbreeding seeds in the Indian seed market. In 1994, the guild acquired seed craft of Hysun India Limited In 2007, Advanta India Limited came with an initial offering of INR crore. The IPO was of equity bundles at a price of INR per equity share Advanta India Limited Corporate Timeline 1994-2012 9 This is a licensed product of Ken Research and should not be copiedA DVANTA INDIA LIMITED ORGANISATIONAL STRUCTURE The bon ton on-line(prenominal)ly has plants in India, out of which plants are located in Andhra Pradesh and plant in Haryana. Out of 16 subsidiaries crosswise the world Advanta Netherland Holdings BV was the highest profit making subsidiary of Advanta, generating a net profit of INR crore during 2011 and Advanta Holdings BV w as the highest loss making subsidiary of INR crore in 2011 Advanta India Limited holds shares that is 100. 0% of Advanta Semillas SAIC and shares of Pacific Seeds Pty. Limited implying 100. % stake in the subsidiary Advanta India Limited Organizational Structure 10 This is a licensed product of Ken Research and should not be copied A DVANTA INDIA LIMITED PRODUCTS PORTFOLIO The attach to engages in types of mark seed products in India and across the globe such(prenominal) as sorghum, corn, cotton, sunflower, mustard, canola and others and for vegetable such as tomato, cauliflower, sweet corn, savoury pepper, okra and others. Business cycle of the company is to research and develop, produce and distribute the seeds to farmers by its distributorsAdvanta India Limited Product Portfolio O IL SEEDS Oil seeds are produced as a source of the production for different types of oil color. The oil seed portfolio of the company consists of the three cross seeds namely sunflower, can ola and Indian mustard. These three products channel the largest proportion of the companys revenue 11 This is a licensed product of Ken Research and should not be copied The company operates in the Australian canola seed market through its 100. 0% possess subsidiary namely, Pacific Seeds Pty Limited.Pacific Seeds is involved in the production of types of hybrid canola seed material body such as email&clxprotected, email&160protected, email&160protected, email&160protected and others. The company has achieved % harvest-time in its global canola business in 2011 y-o-y. The company has a pan India presence in the Indian hybrid mustard market. UPL group in collaboration with submit government of Gujarat has entered into a project for the production of coral-432 with the just selling price of seeds INR 22. 5 and average selling price of oil INR 56. 0 under(a) normal conditions.Advanta India Limited Recent Developments in Oil Seeds Countries Recent Developments in Product Portf olio India Mexico A DVANTA INDIA LIMITED FINANCIAL AND O PERATIONAL PERFORMANCE V ALUATION abbreviation AND FINANCIAL SUMMARY The companys revenue has showcased a CAGR exploitation of 16. 4% from 2008 to 2012. Increase in revenue was due to the expansion of companys operations in various countries in the last five twelvemonths by mergers and acquisitions of different companies. Additionally, over the years the company has been expenditure considerable amount on research and development.These research and development wasting disease has produced new and improved products for the company such as PAC 801, PAC 807 and others in hybrid rice seed which had raise the companys revenues. The revenue for 2012 was INR 1073. 0 crore showcasing a harvest-festival of 17. 7% by y-o-y Net profit of the company has change magnitude at a CAGR of % from 2008 to 2012 12 This is a licensed product of Ken Research and should not be copied The company has been valued at INR crore as on 1st March 2013. The revenue multiple of the company has shown a declining trend.Revenue multiple represents the amount that has to be paid by the investor for purchasing the companys gross revenue. The revenue multiple has declined at a CAGR of % from 2008-2012 showcasing a decline in the value of the company against the companys sales as the amount of sales has been increasing over the years which implies that the company is now more cheaper to grease ones palms as compare to what it was in 2008 Advanta India Limited Financial Performance on the Basis of Revenue, EBITDA Margin and Net Profit Margin in INR Crore, and Percentage, 2008-2012 Particulars (in INR Crore and Percentage) 008 2009 2010 2011 2012 Revenue y-o-y Growth% EBITDA% Net Profit% Advanta India Limited Valuation Analysis on the Basis of Market Capitalization, Net Debt and Enterprise Value in INR Crore and Units as on 1st March 2013 Particulars (in INR Crore and Units) Share Price* Share Outstanding (in Units) Market Capitaliz ation Net Debt Associates/ Minority Interest Enterprise Value Advanta India Limited Valuation Multiples on the Basis of Revenue, EBITDA and Net Profit Multiples, 2008-2012 Particulars 2008 2009 2010 2011 2012 EV/Revenue EV/ EBITDA EV/Net Profit 13 This is a licensed product of Ken Research and should not be copied D CF (DISCOUNTED coin FLOW) VALUATIONA AND UPSIDE P OTENTIAL Advanta India Limited Discounted Cash Flow Valuation on the Basis of Weighted Average Cost to Capital, Present Value of Company Valuation and Target Share Price Particulars Value (in INR Crore, Percentage and Units) WACC Revenue CAGR over 2013-17E Present Value of Cash Flow till 2017E end point Growth Present Value (PV) of endpoint currency flow PV of firm slight Current Debt Total present value of the Equity Number of Equity Shares Outstanding (in Units)DCF Target price (INR) Advanta India Limited Sensitivity Analysis of Discounted Cash Flow Analysis, perpetuity Growth Rate and Weighted Average Cost of Ca pital on the Basis of Perpetuity Growth Rate Method in INR Crore and in Percentage Particulars (in INR Crore and Percentage) Weighted Average Cost of Capital Perpetuity Growth Rate 14 This is a licensed product of Ken Research and should not be copied M ACRO ANALYSIS OF SEED INDUSTRY M ARKET dole out OF MAJOR PLAYERS IN THE INDIAN crown of thorns S EED MARKET, FY2012 The Indian hybrid seed pains is dominated by Nuziveedu Seeds common soldier Limited.The company has a market share of % in the overall Indian hybrid seed industry, followed by Maharashtra Hybrid club (Mahyco) and Vibha Agrotech Limited which have a share of % and % complaisanceively. As per the historical trend, the revenue of the seed companies has been inclining For Monsanto India, corn hybrid was the single(a) biggest focus in seed business. by its Project Golden Rays project the company has signed a public-private partnership with Rajasthan aver government for increasing the maize hybrid yields by two fold s. The project involves 7. 8 lakh tribal farmers.The company has a share of 4. 4% in the overall hybrid seed market Market Share of Major Players in Indian Hybrid Seed Market on the Basis of Contribution by Revenue in Percentage, FY2012 Nuziveedu Seeds Private limited Maharashtra Hybrid Corporation (Mahyco) Monsanto India Limited (MIL) Rasi Seeds Private Limited Bayer CropScience Ltd. India Du Pont Pioneer Syngenta India Ltd. Advanta India Limited Others 15 This is a licensed product of Ken Research and should not be copied A USTRALIAN SEED INDUSTRY MARKET SIZE, FY2008-FY2012 Australia is the secondment largest exporter of canola in the world.Australian seed market has declined at CAGR of % from USD one thousand million to USD million from FY2008 to FY2012. Decline in the Australian seed industry was primarily due to natural disaster in the country which effected the production of seeds. During the advance(prenominal) FY2000, the seeds industry of Australia was at its peak. T he seed sales grew by % to USD million in FY2007 from USD million in FY2005 due to pleasant run conditions in the country, higher commodity prices and affirmatory market sentiments Australian government policies had as well played a major role in the performance of the seed industry of the country.Australian government has unforgiving regulations which have circumscribe the entry of major players in the country. These strict regulations of the government restricted the development of the industry and debarred the nation from adoption of hybrid seeds which very have the potential to extend the agricultural productivity with the limited use of resources. Australia Seed Industry Market Size on the Basis of the Revenue in INR crore, FY2008FY2012 2,500. 0 INR Crore 2,000. 0 1,500. 0 1,000. 0 500. 0 0. 0 FY2008 FY2009 FY2010 FY2011FY2012 16 This is a licensed product of Ken Research and should not be copied C OMPETITIVE ANALYSIS B Y FINANCIAL PERFORMANCE (TOPLINE/ green light VALUE/ M ULTIPLES) Table Company Comparable Analysis on the Basis of Financial Performance in INR Crore and Valuation Multiples as on LTM 31st December 2012 (INR Crore, unless Stated) Company Market Cap Last Twelve Months (LTM) Year coating December 2012 Net Debt Enterprise Value (EV) EV/Revenue EV/EBITDA P/E JK Agri Genetics Limited Advanta Limited India Monsanto Limited India Nath SeedsLimited India Kaveri Seeds Company Limited humble Median 17 This is a licensed product of Ken Research and should not be copied Table Company Comparables on the Basis of Revenue in INR Crore, FY2008-LTM year ending 31st December 2012 Revenue (in INR Crore) FY2008 FY2009 FY2010 FY2011 FY2012 LTM JK Agri Genetics Limited* Advanta India Limited** Monsanto India Limited Kaveri Seeds Company Limited Nath Seeds India Limited A DVANTA INDIA LIMITED early jutting Advanta India Limited has been focusing the European hybrid seed market.After doing research for over 4 years, the company is planning its fi rst hybrid sunflower seed sale in Romania, Ukraine, Romania and France. Advanta provide launce hybrids sunflower seeds products to farmers of these countries under ALTA fool. The hybrids sunflower seeds will generator their brand name in incoming and evaluate to capture sizable market share in the European seed market. This will lead to an increment in wage of the company in future. The company has lately entered into a genetically modified (GM) corn agreement with Monsanto for two countries namely, Brazil and Philippines.GM corn is developed by adding animals DNA into seeds DNA and thus amplifies the advantage of the seeds The company is expected to showcase a revenue growth of CAGR % from 2012 to 2017. Additionally, the company is spending substantial amount on research and development of products and these new products will translate positive change flow in future and will increase the revenue of the company. All these factors will lead to an increase in companys reven ue from INR 1,073. 0 crore in 2012 to crore in 2017. 18 This is a licensed product of Ken Research and should not be copiedAdvanta India Limited Future Projections on the Basis of Revenue, EBITDA Margin and Net Profit Margin in INR Crore and Percentage, 2013-2017 3,500. 0 16. 0% 3,000. 0 14. 0% INR Crore 10. 0% 2,000. 0 8. 0% 1,500. 0 6. 0% 1,000. 0 in Percentage 12. 0% 2,500. 0 4. 0% 500. 0 2. 0% 0. 0% 0. 0 FY2013 Revenue FY2014 FY2015 EBITDA Margin FY2016 FY2017 Net Profit Margin A DVANTA INDIA LIMITED COMPANY FINANCIALS FUTURE P ROJECTIONS Over the years Advanta India Limited has been showing a constant growth in its shareholders funds as the company has been constantly generating afterwards tax net profit expect in 2010.Net price of the company has increased at a CAGR of % from 2009-2012, representing increase in profitability margin of the company. The company is expected to follow the selfsame(prenominal) trend in future and evaluate to increase its net worth at CAGR of % from 2012-2015. As of now the contribution of aliens funds in the fare assets of the business is greater than shareholders equity but with the increase in profitability the company is expected to reverse this scenario and debt to equity ratio will decrease in future 19 This is a licensed product of Ken Research and should not be copied The companys cash flow from operation has showcased a positive growth trend in 2011 and 2012. It is anticipated that the cash flow from operation of the company will increase at a CAGR of % from 2011-2015 for the most part due to increase in after tax net profit of the company. In 2015 it is expected that the company will increase its revenue from operations by % y-o-y. An average annual growth of % is expected in the companys capital expenditure from 2011-2015 due to commercial messageization and expansion of business.Overall cash and cash equivalent balance of the company is expected to increase at a CAGR of % from 2011-2015 20 This is a lice nsed product of Ken Research and should not be copied D ISCLAIMER The research insures provided by Ken Research are for the individualized selective learning of the authorized recipient and is not for public distribution and should not be reproduced or redistributed without prior permission. You are permitted to bulls eye or download extracts from this material for your personal use only. None of this material may be used for any commercial or public use.The information provided in the research documents is from publicly available entropy and other sources, which are reliable. Efforts are turn to try and ensure accuracy of data. With respect to documents available, neither the company nor any of its employees makes any warranty, express or implied, including the warranties of merchantability and fitness for a particular purpose, or assumes any sub judice liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus, product, or wor k disclosed, or represents that its use will not infringe privately owned rights.The report also includes analysis and views expressed by our research team. The research reports are rigorously for information purposes. The opinions expressed are our current opinions as of the date appearing in the material and may be depicted object to change from time to time without notice. Investors should not solely rely on the information contained in the research documents and must make investment decisions based on their own investment objectives, risk profile and financial position.The recipients of this material should take their own sea captain advice before acting on this information. Ken Research will not possess returns of reports once dispatched due to the confidentiality of information provided in our reports. In case, a report convert for return, we will issue a credit, damaging shipping charges, of equal value to the passkey purchase price, toward a future purchase no refunds. The decision about whether the product return can be accepted or not is solely at our discretion.Any dispute will be conquer to laws of India and exclusive jurisdiction of Indian Courts. No part of this manual or any material appearing may be reproduced, stored in or transmitted on any other Web point without written permission of Ken Research and any payments of a specified fee. Requests to republish any material may be sent to us. 21 This is a licensed product of Ken Research and should not be copied