Weekly Wrap - India Infoline
Transcription
Weekly Wrap - India Infoline
Weekly Wrap Investment Idea January 23, 2015 Cadila Healthcare BUY CMP `1,645 Cadila Healthcare is poised to accelerate earnings with ~30% EPS cagr over FY15-17E driven by robust traction in US generics, revival of domestic growth and margin expansion from c19.2% in H1 FY15 to ~22% in FY17. US revenues would ramp up to ~28.5% cagr on the back of expected sizable launches from mesalamine portfolio (Asacol HD, Lialda), transdermals and chronic therapies (Prevacid, Abilify). Domestic business is set to revive with 13.7% formulations growth over next two years as the dual impact of NLEM and discontinued Boehringer JV sales wears off from Q4 onwards. Slew of product launches in US and domestic momentum would translate in to 17.4% revenue cagr accompanied by ~300bps margin expansion with US responsible for most of the OPM delta. Stock trades at 18x FY17 earnings and given that profitability metrics and earnings growth are comparable to larger domestic peers, we believe stock can rerate further; recommend BUY. Delay in approvals for US launches and tepid domestic growth key risks to our margin/ earnings forecasts and bullish reco. Healthy pipeline to drive US revenue momentum Cadila’s US business posted 18.6% US$ revenue cagr over FY12-14 and we expect a significant step up in US business on the back of several sizable launches (discussed in table below). Focus would be on launching complex and niche products in oral solids, injectables, nasals, topical and transdermals to strengthen its improving position (8th amongst generic companies in US vs 10th in previous year). It owns a robust ANDA pipeline with ~250 ANDAs filed so far and approvals for >90 products; it expects 10-15 product approvals and about 40 filings in the current fiscal. Between FY11-14, Cadila had launched just over 30 products in US market including that from Nesher, a controlled substance manufacturer it had acquired in FY12. India growth to revive in FY16 Cadila enjoys leading positions in key therapeutic areas like cardiovascular, gastro intestinal, women’s healthcare and respiratory segments; notably it climbed up to 4th position in dermatology in the previous fiscal. It has launched >75 new products including line extensions in the domestic market in FY14 of which 19 were first time launches and included launch of Lipaglyn, the first New Chemical Entity (NCE) developed through in-house R&D. Recent domestic growth has been impacted by NLEM and discontinuance of BI JV products whose effects would fade off from Q4 of current fiscal. For instance, although the headline growth in domestic market was 9% in Q2 FY15, if one excludes the NLEM and BI impact, growth would have been much better at 14%. Hence we model in 13.7% cagr for domestic formulations over FY15-17E. Mixed outlook for Europe; Brazil lackluster from lack of approvals After US and India, Europe and emerging markets are the other two key contributors to Cadila’s generic growth. Within Europe, our interaction with the company suggests focus would remain on France and Spain. In France, company had to bear the impact of increase in discount on generics from 17% to 40%. To counter this, company has rationalized its’ distribution so as to protect profitability though revenues might be under pressure. Spanish growth has been in line with the market in FY14. The target markets of France Spain have combined size of ~US$6.5bn of which Zydus share with FY14 Sector: Pharmaceuticals Sensex: 52 Week h/l (`): Sector View: Positive 29,278 BSE code: 532321 1,760 / 805 NSE code: CADILAHC Market cap (`cr): 33,637 FV (`): 5 Share price chart Share holding pattern (%) Jun14 Sep14 Dec14 Promoters 74.8 74.8 74.8 Insti 14.2 14.5 14.6 Others 11.0 10.7 10.6 Cadila 240 Sensex 200 160 120 80 Jan-14 Jul-14 Jan-15 revenues of `3.9bn stands at ~1%. More importantly, company’s growth has been faster at 5.5% in FY14 compared to 2-3% for the relevant markets. In Brazil, Cadila highlighted lack of product approvals as the biggest challenge that has hindered growth; Q2 FY15 saw growth of just 1-2% for its branded and generics businesses. We conservatively factor in no new product approvals for the Brazilian business and muted revenue growth for the three geographies. ~30% earnings cagr to support further rerating; initiate with BUY Uptick in US business is the key bulwark of our ~30% earnings cagr over FY15-17 as we factor in approvals for several important ANDAs. Domestic growth would return to close to mid teens growth for next two years. Stock trades at 18x FY17 earnings, at a discount to larger peers; expect the valuation gap to narrow and initiate with BUY based on 21x FY17E earnings. Financial summary Y/e 31 Mar (` m) Revenues yoy growth (%) Operating profit OPM (%) FY14 FY15E FY16E FY17E 72,240 84,918 99,176 117,005 13.6 17.6 16.8 18.0 12,001 16,375 20,546 25,999 16.6 19.3 20.7 22.2 8,036 10,982 14,278 18,665 yoy growth (%) 23.0 36.7 30.0 30.7 EPS (`) 39.2 53.6 69.7 91.1 Reported PAT P/E (x) 41.9 30.6 23.6 18.0 EV/EBITDA (x) 15.9 11.4 8.8 6.6 Debt/Equity (x) ROE (%) 0.8 0.6 0.5 0.4 25.9 29.2 29.9 30.7 20.6 22.5 24.3 ROCE (%) 16.9 Source: Company, India Infoline Research Click here for the detailed report on the same. India Infoline Weekly Wrap Market Outlook The January jolt has been on the positive side this year and the indices seem to be racing to new highs every day. While the euphoria could be attributed to a variety of reasons, consensus seems to hinge on reforms and a positive sentiment following IMF report that India is expected to grow at 6.3% this year and 6.5% in 2016. ECB’s decision to flood the eurozone with freshly created money was the muchawaited stimulus for the market and the indices gave the decision a thumbs up. ECB announced it will buy at least €1 trillion of the region’s bonds from March 2015 to September 2016. This was much better than what the Street or every street was expecting. In the last two weeks, the NSE Nifty index shot up by over 600 points or 7.6% to race past the 8800 mark while the BSE Sensex conquered 29000 mark. Steady FII inflows and hopes of reforms in the upcoming Budget will keep spirits high. Any correction may be shortlived unless there are major global events. The coming week being a truncated one will be choppy too. Over the weekend the developments in Greece will playout and Indian markets will get a chance to react only on Tuesday. Various sectors will also react to Obama’s visit and the promises he makes. Moreover, with the F&O expiry in the coming week, wild swings could well take place. FIIs/MFs activity 2,400 Technical View Market is now clearly driven by momentum as seen in this week’s trade. When a momentum driven market starts taking control of the proceedings, traders should not be concerned about upside target. Because this momentum could easily surpass projected targets (8920). Follow this uptrend till it continues. Index is in a sweet spot where it is likely to see new highs every other day and in case there is retracement or pause, make a fresh entry. F&O View Nifty managed 3.5% weekly gains, sharp upside momentum continued closing on life time high levels above 8800 zone at the end of the week, Index futures continued to see long buildup from the FII’s, with long/short in index future moving to 6.46x levels. PCR moved towards 1.33 levels with heavy put writing visible across the strikes. Banking leading the rally with HDFC twins taking bank nifty higher. Global events and F&O January expiry likely keep markets volatile coming few days. Advance/Decline (Rs cr) 1,200 Net FIIs inflow 2,000 (No of stocks) Advance Decline Net MFs Inflows 900 1,600 1,200 600 800 300 400 0 0 (400) 15-Jan 16-Jan 19-Jan 20-Jan 21-Jan Global performance Shanghai Realty Nasdaq 19-Jan 20-Jan 4.1 2.6 Auto 2.2 IT 3.8 1.4 Health Care Small Cap 3.8 Nikkei 2.8 BSE-200 3.1 Nifty 3.5 3.2 Banks 2.5 1.0 Oil & Gas Sensex Metals 4.1 1.0 2.0 5.7 4.8 Power Hangseng 2 16-Jan FMCG 1.7 0.0 15-Jan (%) Capital Goods Dow Jones (1.0) 14-Jan Sectoral performance (%) (0.7) 13-Jan 3.0 4.0 5.0 (0.9) (4.1) (6.0) (4.5) (3.0) (1.5) 0.0 1.5 3.0 4.5 6.0 7.5 India Infoline Weekly Wrap Technical Check Nifty 50 & CNX 500 top 10 Losers Nifty 50 & CNX 500 top 10 gainers NSE Nifty Company NSE Nifty CNX 500 CMP (`) % Chg Company CMP (`) % Chg Company CNX 500 CMP (`) CMP (`) % Chg 66 12.0 ITC 349 (3.0) Educomp 26 (7.2) 122 18.9 TECHM 2,781 (1.3) Info Edge 779 (6.9) 9.8 Sunteck Realty 261 17.8 Hero Motor 2,863 (1.2) Dhanlaxmi Bank 38 (6.3) 602 9.4 Muthoot Finance 223 12.9 TCS 2,504 (1.1) Ivrcl 927 9.1 Rajesh Exports 160 12.8 Kotak Bank 1,385 (0.7) Sks Micro Bharti Airtel 384 12.0 Sterlite Tech Tata Motors 588 11.9 GSFC Axis Bank 565 Wipro Sun Pharma HDFC 1,290 8.0 Adani Ent 564 12.7 Gail L&T 1,711 7.5 Shanthi Gears 146 12.0 Maruti 3,607 7.4 Max India 454 11.8 Hcl Tech 1,647 Tata Power % Chg Company 89 DLF 157 7.1 - - - ONGC Cairn India 248 7.1 - - - Bajaj Auto Technically strong 423 (0.5) STFC 17 (6.2) 441 (6.1) 1,095 (6.0) (0.3) ENIL 349 2,442 569 (5.9) 0.5 Patel Eng 93 (5.9) 0.5 PFS 64 (5.9) - - 0.9 - Technically weak Total Traded Qty (lacs) 10 days Average Traded Qty (lacs) CMP (`) 10 days Moving Average (`) Total Traded Qty (lacs) 10 days Average Traded Qty (lacs) Company CMP (`) 10 days Moving Average (`) HCL Tech 1,647 1,619 9.2 11.2 DENA BANK 59 60 24.7 9.3 BPCL 675 660 30.1 12.1 UCO BANK 80 82 13.5 22.6 IFCI 38 37 68.2 41.0 LITL 6 6 34.9 55.7 476 465 92.4 28.9 TATACOMM 416 425 42.5 4.7 1,015 990 12.0 5.5 IOC 331 336 45.9 8.8 RELCAP JSW STEEL Bulk deals Book closure and record date Qty (lacs) Price (`) Company Date Purpose TCS 27 Jan 2015 3rd Interim Dividend - `.5.00 B 7.7 132.0 BEL 28 Jan 2015 Interim Dividend Vindhya Telelinks B 5.0 510.0 CENTURYPLY 29 Jan 2015 Interim Dividend - `.0.75 Shemaroo Ent B 4.7 231.5 DBCORP 29 Jan 2015 Interim Dividend - `.3.50 IBSEC 29 Jan 2015 3rd Interim Dividend - `.1.00 Date Institution Scrip name 19-Jan SBI Funds Shanthi Gears 19-Jan Reliance MF 21-Jan JPMSL Mauritius B/S Nifty Future VWAP Bank Nifty Future VWAP Nifty Futs Close 8900 Company Nifty Vwap Bank Nifty Futs Close 8800 20100 8700 19800 8600 19500 8500 19200 8400 18900 8300 18600 8200 18300 19-Jan 20-Jan 21-Jan 22-Jan 23-Jan Bank Nifty Vwap 20400 19-Jan 20-Jan 21-Jan 22-Jan 23-Jan 3 India Infoline Weekly Wrap Commodity Corner Base metals Precious metals Base metals traded on a fragile note this week, as markets remain unimpressed by the slew of macroeconomic numbers from China. In this respect, China's Q4 GDP grew 7.3% (yoy basis), replicating the growth rate during the prior quarter. The economy during 2014 grew 7.4%, lower than the growth rate of 7.7% in 2013. Industrial output during December rose 7.9% on yoy basis, much better than the 7.2% rise in November. Retail sales during December grew 11.9% on yoy basis, moderately better from an 11.7% increase in November. Meanwhile, Fixed-asset investment during 2014 rose 15.7%, much lower than the growth rate of 19.6% in 2013. In the latest, HSBC China Manufacturing preliminary PMI for November was reported at 49.8, still below the 50 mark that separates growth from contraction. The yellow metal steered above US$1,300/oz mark, as economic headwinds across the globe has reinforced the safe haven appeal for the metal. IMF slashed its global economic growth forecasts from 3.8% to 3.5% for 2015. IMF expects 2016 growth to clock around 3.7%. Markets were also concerned with the persistent weakness in the euro. Swiss national Bank’s decision to the end the peg with euro has changed the complexion of the currency markets. At the current juncture, Gold prices are holding around US$1,300/oz amid extreme volatility in the currency markets influenced by ECB measures. Euro tumbled to an 11 year low against the greenback, with US dollar index advancing well above 94 levels. In respect with the ECB policy decision, the central bank announced 1.1 trillion Euros quantitative easing package that would start in March and extend through September of 2016. The announcement was well above the market expectations. The bank will conduct monthly purchases of 60bn Euros that would likely comprise of about 45bn Euros in sovereign bonds, 5bn Euros in Euro-area public agencies and 10bn Euros of asset-backed securities The degree of pessimism in the non-ferrous pack can be manifested by the fact that it has failed to derive any optimism from the stimulus measures announced by the European Central Bank. It seems the market participants are doubtful regarding the efficacy of the QE program, considering the looming threat of deflation in the region. Prior monetary easing measures have simply failed to revive the economic growth trajectory in the region. On outlook, selling pressure will continue to resurface in most of the base metals. On outlook, the focus will shift to the Greece elections, wherein the antiausterity Syriza party has widened its lead over the ruling conservatives to 6%. A victory for Syriza can increase the probability of Greece exiting from EU and in the process will destabilize the Euro again. This can spell in to an extended upside for the precious pack. Charts suggest an upside target till US$1,325/oz Note: This market commentary is written at 12:00 PM IST LME prices Weekly inventory update Base Metals (US$/ton) High Low LTP* Chg(%) Copper 5,805 5,590 5,665 (0.9) Tons Abs Chg. Chg (%) Copper (LME) 235,150 34,750 Nickel 15,170 14,401 14,850 17.3 0.5 Nickel (LME) 423,036 4,518 1.1 Zinc 2,159 2,048 Aluminium 1,883 1,787 2,141 2.1 Zinc (LME) 1,866 1.1 Aluminium (LME) Lead 1,918 1,770 1,890 2.2 Lead (LME) 645,775 (12,325) (1.9) 4,086,175 (36,425) (0.9) 215,100 (725) (0.3) 11,990 (120) (1.0) 134,137 (2,679) (2.0) 76,353 (2,491) (3.2) 186,071 (5,970) (3.1) Tin (LME) Precious Metals (US$/ounce) Gold High Low LTP* Chg(%) 1,308 1,255 1,295 1.1 Shanghai Zinc 18.5 16.9 18.2 2.3 Shanghai Aluminium Silver * Last Traded Price LME Copper 10500 Shanghai Copper COMEX Gold US$/ ton 2050 Copper (LME) US$/ ounce Gold 1900 9500 1750 8500 1600 7500 1450 6500 4 Jan-15 Jul-14 Oct-14 Jan-14 Apr-14 Jul-13 Oct-13 Jan-13 Apr-13 Jul-12 Oct-12 Apr-12 Jan-12 Jul-11 Oct-11 Apr-11 Jan-11 Jan-15 Jul-14 Oct-14 Apr-14 Jan-14 Jul-13 Oct-13 Jan-13 Apr-13 Oct-12 Jul-12 Jan-12 Apr-12 Jul-11 Oct-11 1000 Jan-11 4500 Apr-11 1150 Oct-10 5500 Oct-10 1300 7 0 6 (2) 5 110 100 30 (%) Six core Ind. (INR/EURO) (INR/USD) (INR/GBP) (INR/JPY) IIP and Six core Industries IIP 130 12 8 4 0 (4) Currency Movements 90 60 40 120 40 95 80 90 70 85 70 Jun-12 Nymex Crude Dec-12 Dec-14 Sep-14 Jun-14 Mar-14 Dec-13 10yr Gsec yield 3mth CP rate Sep-13 Jun-13 Mar-13 4 Sep-12 6 Mar-12 8 Sep-11 12 (%) Dec-11 10 Jun-11 13 Mar-11 14 Dec-10 MFG Products Sep-10 Dec-14 Sep-14 Jun-14 Mar-14 Monthly Inflation Dec-13 Sep-13 Jun-13 Mar-13 Dec-12 Sep-12 12 (%) Jun-12 Mar-12 Dec-11 Sep-11 14 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 2 Jun-11 Inflation May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 (8) May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 16 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 India Infoline Weekly Wrap Chartbook Interest Rate 5yr AAA bond yield 11 10 9 8 Crude (Brent/ Nymex) Brent Crude 110 100 90 80 70 60 50 Dollar Index 100 Dollar Index 50 80 75 Source: Bloomberg 5 6 Source: Bloomberg 25 1,575 20 1,570 15 1,565 10 1,560 Sensex PE Band 60,000 24.0 50,000 29x 40,000 24x 30,000 18x 20,000 10,000 13x 7x 0 22.0 PE (x) Cur. Yr Sensex 1,580 Nasdaq 30 (Rs) Mexico Bolsa VIX S&P 500 35 Dow Jones 1,590 FTSE Volatility Index Straits 250 DAX 40 Taiwan 300 Shanghai PE Comparision 1-Yr Fwd 20.0 18.0 16.0 14.0 12.0 10.0 8.0 6.0 Jan-15 Oct-14 Jul-14 Apr-14 Jan-14 Oct-13 Jul-13 Apr-13 Jan-13 Oct-12 Jul-12 Apr-12 Jan-12 Oct-11 Jul-11 50 Apr-11 60 Jan-11 China 1-Nov 3-Nov 5-Nov 7-Nov 9-Nov 11-Nov 13-Nov 15-Nov 17-Nov 19-Nov 21-Nov 23-Nov 25-Nov 27-Nov 29-Nov 1-Dec 3-Dec 5-Dec 7-Dec 9-Dec 11-Dec 13-Dec 15-Dec 17-Dec PMI Hang Seng US Nov-14 Germany Oct-13 Euro Zone Oct-12 India Sep-11 Sep-10 Aug-09 40 Aug-08 Jul-07 Jul-06 Jun-05 (%) Jun-04 May-03 May-02 Apr-01 45 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 65 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 India Infoline Weekly Wrap Chartbook... US Initial Jobless Claims 550 500 Initial Jobless Claims ('000) 55 450 400 350 Sensex Earning Estimates FY15 1,585 India Infoline Weekly Wrap News Recap The Union Budget for financial year 2015-16 will be presented on Saturday, February 28. (BL) After four years of introducing the base rate, the rate below which the banks cannot lend, the Reserve Bank of India has indicated that it may be lenient on its practice with market borrowings by companies and banks buying them, making it nearly irrelevant. (ET) Ahead of Budget 2015-16, Finance Minister Arun Jaitley said more fuel subsidy reforms were on the anvil to cut the Centre's fiscal deficit.(BS) India is expected to grow at 6.3 per cent this year and 6.5 per cent in 2016 by when it is likely to cross China’s projected growth rate, the IMF said while terming the new government’s reforms as “promising” but insisted that their implementation is key. (BL) Road projects worth `500bn would be started in Uttar Pradesh by the year-end, Union Surface Transport Minister Nitin Gadkari said. (ET) The government initiated the coal block re-allocation process by starting allotment of 36 coal mines to state run entities from Jan 23. (BS) Emami did not diclose the size of the deal, but said that the acquisition would give it a foothold in the natural and organic personal care market, pegged globally at nearly `470bn. (BL) Oil India Ltd (OIL) and Oil and Natural Gas Corporation (ONGC) may not get a full exemption from sharing the oil subsidy. This is because the government is reworking the subsidy sharing formula to cope up with difficult situation posed by falling crude prices, only as a temporary relief. (BS) Government has sought expression of interest from reputed merchant bankers for divesting 10% stake in iron ore miner NMDC that could fetch about `55bn to the exchequer. (BS) The half a dozen public interest litigations (PIL) filed in various courts across the country against the proposed launch of four-wheeled transport vehicle called quadricycle has been instigated, claims Pune-based bike major Bajaj Auto. (BS) Auto major Maruti and consumer durables maker Lloyd Electric (brand to be promoted will be Lloyd Air Conditioners) will be on-air sponsors of the month-and-a-half-long cricket world cup. (BS) ECB will pump EUR60bn per month till September 2016 towards its fiscal stimulus measures. (BS) Tata Consultancy Services (TCS), India's largest IT services provider announced that it has been selected by Virgin Atlantic Airways (VAA), one of the UK's leading airlines, to provide fully managed services to transform and optimise its IT processes, applications and infrastructure. (BS) SpiceJet opened flight bookings beyond March 29 till October 24 this year, though the troubled low-cost carrier refrained from offering any deep discounts, pricing its tickets at par with key rivals IndiGo and Go Air. (BS) Mahindra Two Wheelers (MTWL), part of the Mahindra & Mahindra group, announced that they have completed the necessary formalities for the 51% acquisition in France-based Peugeot Motocycles (PMTC). (BL) Mumbai-based Tata Motors has priced its new-age hatchback Bolt attractively at ` 4.65 lakh (ex-showroom, Mumbai) for the petrol version. (BS) Strides Arcolab Limited has entered into a licensing agreement with Gilead Sciences, Inc for marketing HIV drugs. (BL) Kolkata-based Emami Ltd has made its third acquisition in six months by buying a controlling stake (66.67%) in Fravin Pty Ltd, an Australian organic personal care products maker. The Competition Commission of India (CCI) will soon decide on the proposed merger of French cement maker Lafarge and Swiss peer Holcim. (ET) Event Calendar Period: 26th Jan – 31st Jan 2015 US • Dec Durable Goods Orders (27 Jan) China • Dec Industrial Profits YoY (27 Jan) • Dec New Home Sales MoM (27 Jan) • • FOMC Rate Decision(29 Jan) • Q4 GDP Annualized QoQ (30 Jan) Europe • Dec Unemployment Rate (30 Jan) Dec Leading Index (28 Jan) India • Dec Fiscal Deficit INR (30 Jan) • • Euro Area Third Quarter Government Deficit (22 Jan) • • Jan CPI Core YoY (30 Jan) Q1 GDP Annual Estimate YoY (30 Jan) Jan CPI Estimate YoY (30 Jan) IIFL, IIFL Centre, Kamala City, Senapati Bapat Marg, Lower Parel (W), Mumbai 400 013 The information in this newsletter is generally provided from the press reports, electronic media, research, websites and other media. The information also includes information from interviews conducted, analysis, views expressed by our research team. Investors should not rely solely on the information contained in this publication and must make their own investment decisions based on their specific investment objectives and financial position and using such independent advisors as they believe necessary. The materials and information provided by this newsletter are not, and should not be construed as an advice to buy or sell any of the securities named in this newsletter. India Infoline may or may not hold positions in any of the securities named in this newsletter as a part of its business. Past performance is not necessarily an indication of future performance. India Infoline does not assure for accuracy or correctness of information or reports in the newsletter. 7