tag:blogger.com,1999:blog-17218826597987272512024-02-20T13:36:51.441+05:30My Experiments with FinanceThe Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.comBlogger28125tag:blogger.com,1999:blog-1721882659798727251.post-46350885011172870222014-04-11T17:45:00.002+05:302014-04-11T17:45:59.486+05:30Piramal Healthcare’s 11% Vodafone Stake – Definitely worth it!<div dir="ltr" style="text-align: left;" trbidi="on">
A little over 2 years ago I had written an article talking about Piramal's acquisition of an 11% stake in Vodafone India titled "Piramal Healthcare’s 11% Vodafone Stake – Is it worth it?". With the final conclusion of the sale of Vodafone, we can definitely say "Definitely Worth It".<br />
<br />
But what does this mean to the stock price of Piramal? It has already risen 5% for two consecutive days since the announcement. So is the valuation just about right? Or is there an more room for growth? These are the questions a wannabe investor of Piramal must be asking himself.<br />
<br />
In my opinion, Piramal is again at the same stage it was 2 years back. They have made a capital gain of around 2000 crores after tax on the transaction and further bolstered their coffers. They are again poised in investing these funds in their existing business or a new venture and get a decent ROE. All that we can know probably during their next analyst presentation/call.<br />
<br />
But the Book Value of the company keeps increasing. The market cap is still INR 10,000 crore whereas their Vodafone investment itself was worth INR 8900 crore. Hence in my opinion, this still remains a BUY!</div>
The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-14527480931648329972012-06-21T15:02:00.000+05:302012-06-21T15:03:44.676+05:30Piramal Healthcare acquisition of Decision Resources Group - An attempt to value DRG<div dir="ltr" style="text-align: left;" trbidi="on">
<br />
<div class="MsoNormal">
With Piramal Healthcare stock slowly and steadily marching
northwards (Disclaimer: It has been my favorite stock for almost a year, so
this post may be a little biased<span style="font-family: Wingdings;"></span> ) following a slew of acquisitions (and a Rs17.5
dividend per share coming up), I once again pause to take a look at the latest
acquisition – Decision Resources Group for a sum of approximately $635 million. All the reasons given in their investor
presentation indicate the attractiveness of holding this company in the
portfolio. But again the question arises (as earlier with Vodafone India’s stake),
have they paid an appropriate value for this? So, I make an attempt to value
DRG, but the same being a privately held company a lot of assumptions need to
be made.</div>
<div class="MsoNormal">
<br />
<a name='more'></a><br /></div>
<div class="MsoNormal">
As a start, let us consider the information available:</div>
<div class="MsoNormal" style="margin-left: .5in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
1)<span style="font: 7pt "Times New Roman";"> </span>Projected
revenue of $160mn for 2012 </div>
<div class="MsoNormal" style="margin-left: .5in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
2)<span style="font: 7pt "Times New Roman";"> </span>Revenue
growth of 20% CAGR over past 5 years</div>
<div class="MsoNormal" style="margin-left: .5in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -.25in;">
3)<span style="font: 7pt "Times New Roman";"> </span>Industry
EBITDA margins in the range of 15%-30%</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
For valuing the company, I need to make assumptions for the
following factors:</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal" style="margin-left: .5in; mso-list: l1 level1 lfo2; tab-stops: list .5in; text-indent: -.25in;">
<i>1)<span style="font: 7pt "Times New Roman";"> </span>Growth
Rate for next 4 years</i></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal" style="margin-left: .5in;">
Two cases have been considered: 20%
and 17.5%</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal" style="margin-left: .5in; mso-list: l1 level1 lfo2; tab-stops: list .5in; text-indent: -.25in;">
<i>2)<span style="font: 7pt "Times New Roman";"> </span>Discount
Rate</i></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal" style="margin-left: .5in;">
As the buyout would be in
debt/equity ratio of 1:1, I have assumed that this would also be the final
capital structure. The cost of debt is taken as 5.5% (based on Piramal‘s call
transcript) and equity is taken as 13%, thereby coming to a discount rate of
9.25%</div>
<div class="MsoNormal" style="margin-left: .5in;">
<br /></div>
<div class="MsoNormal" style="margin-left: .5in; mso-list: l1 level1 lfo2; tab-stops: list .5in; text-indent: -.25in;">
<i>3)<span style="font: 7pt "Times New Roman";"> </span>EBITDA
Margins</i></div>
<div class="MsoNormal" style="margin-left: .25in;">
<br /></div>
<div class="MsoNormal" style="margin-left: .5in;">
Various cases have been considered
for the same.</div>
<div class="MsoNormal" style="margin-left: .25in;">
<br /></div>
<div class="MsoNormal" style="margin-left: .5in; mso-list: l1 level1 lfo2; tab-stops: list .5in; text-indent: -.25in;">
<i>4)<span style="font: 7pt "Times New Roman";"> </span>Net
CapEx in future</i></div>
<div class="MsoNormal" style="margin-left: .25in;">
<br /></div>
<div class="MsoNormal" style="margin-left: .5in;">
For estimating the same, I have
taken into consideration the ratio of Net CapEx required per unit increase in Sale. This has been taken
from that of Cognizant, which also has an analytics practice (for lack of a
better comparable). The average value for the past two years was found to be
0.475. This means, for a dollar increase in sale, $0.475 needs to be the net
capex (New CapEx – Depreciation).</div>
<div class="MsoNormal" style="margin-left: .5in;">
<br /></div>
<div class="MsoNormal" style="margin-left: .5in; mso-list: l1 level1 lfo2; tab-stops: list .5in; text-indent: -.25in;">
<i>5)<span style="font: 7pt "Times New Roman";"> </span>Change
in Net Working Capital (Non Cash) </i></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal" style="margin-left: .5in;">
For estimating the same, I have
taken into consideration the ratio of change in Net Working Capital required
per unit increase in Sale.
This has been taken from that of Cognizant, as in the earlier case. The average
value for the past two years was found to be 0.065. This means, for a dollar
increase in sale, $0.065 needs to be added to the working capital.</div>
<div class="MsoNormal" style="margin-left: .5in;">
<br /></div>
<div class="MsoNormal" style="margin-left: .5in; mso-list: l1 level1 lfo2; tab-stops: list .5in; text-indent: -.25in;">
<i>6)<span style="font: 7pt "Times New Roman";"> </span>Effective
Tax rate </i></div>
<div class="MsoNormal" style="margin-left: .25in; text-indent: .25in;">
<br /></div>
<div class="MsoNormal" style="margin-left: .25in; text-indent: .25in;">
I have taken a
very conservative assumption of 30%.</div>
<div class="MsoNormal" style="margin-left: .25in;">
<br /></div>
<div class="MsoNormal" style="margin-left: .5in; mso-list: l1 level1 lfo2; tab-stops: list .5in; text-indent: -.25in;">
<i>7)<span style="font: 7pt "Times New Roman";"> </span>Terminal
Growth Rate</i></div>
<div class="MsoNormal" style="margin-left: .5in;">
<br /></div>
<div class="MsoNormal" style="margin-left: .5in;">
Again two cases are taken – 3% and
5% </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b style="mso-bidi-font-weight: normal;"><u>Result of the
valuation exercise</u></b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Based on the EBITDA margin and terminal growth assumptions I
have taken into consideration, we get six cases as shown in the tale below:</div>
<div class="MsoNormal">
<br /></div>
<div align="center">
<table border="0" cellpadding="0" cellspacing="0" class="MsoNormalTable" style="border-collapse: collapse; margin-left: 4.65pt; width: 368px;">
<tbody>
<tr style="height: 12.75pt; mso-yfti-firstrow: yes; mso-yfti-irow: 0;">
<td style="border: solid windowtext 1.0pt; height: 12.75pt; mso-border-bottom-alt: .5pt; mso-border-color-alt: windowtext; mso-border-left-alt: 1.0pt; mso-border-right-alt: .5pt; mso-border-style-alt: solid; mso-border-top-alt: 1.0pt; padding: 0in 5.4pt 0in 5.4pt; width: 73.0pt;" width="97"><div align="center" class="MsoNormal" style="text-align: center;">
<br /></div>
</td>
<td colspan="3" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid black 1.0pt; border-top: solid windowtext 1.0pt; height: 12.75pt; mso-border-bottom-alt: windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-left-alt: windowtext .5pt; mso-border-right-alt: black 1.0pt; mso-border-style-alt: solid; mso-border-top-alt: windowtext 1.0pt; padding: 0in 5.4pt 0in 5.4pt; width: 203.0pt;" width="271"><div align="center" class="MsoNormal" style="text-align: center;">
<b><span style="font-family: Arial; font-size: 10pt;">Terminal Growth of 5%</span></b></div>
</td>
</tr>
<tr style="height: 12.75pt; mso-yfti-irow: 1;">
<td style="border-top: none; border: solid windowtext 1.0pt; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext 1.0pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 73.0pt;" width="97"><div align="center" class="MsoNormal" style="text-align: center;">
<br /></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 60.0pt;" width="80"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">a</span></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 71.0pt;" width="95"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">b</span></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-right-alt: solid windowtext 1.0pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 1.0in;" width="96"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">c</span></div>
</td>
</tr>
<tr style="height: 38.25pt; mso-yfti-irow: 2;">
<td style="border-top: none; border: solid windowtext 1.0pt; height: 38.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext 1.0pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 73.0pt;" width="97"><div align="center" class="MsoNormal" style="text-align: center;">
<i><span style="font-family: Arial; font-size: 10pt;">EBITDA Margin</span></i></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 38.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 60.0pt;" width="80"><div align="center" class="MsoNormal" style="text-align: center;">
<i><span style="font-family: Arial; font-size: 10pt;">Fixed 22.5%</span></i></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 38.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 71.0pt;" width="95"><div class="MsoNormal">
<i><span style="font-family: Arial; font-size: 10pt;">Increasing
from 18% to 26% in 9 yrs</span></i></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 38.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-right-alt: solid windowtext 1.0pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 1.0in;" width="96"><div class="MsoNormal">
<i><span style="font-family: Arial; font-size: 10pt;">Increasing
from 20% to 26% in 9 yrs</span></i></div>
</td>
</tr>
<tr style="height: 26.25pt; mso-yfti-irow: 3;">
<td style="border-top: none; border: solid windowtext 1.0pt; height: 26.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext 1.0pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 73.0pt;" width="97"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">Valuation ($mn)</span></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 26.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 60.0pt;" width="80"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">$738.91 </span></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 26.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 71.0pt;" width="95"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">$960.76 </span></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 26.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-right-alt: solid windowtext 1.0pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 1.0in;" width="96"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">$972.14 </span></div>
</td>
</tr>
<tr style="height: 13.5pt; mso-yfti-irow: 4;">
<td style="border-top: none; border: solid windowtext 1.0pt; height: 13.5pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 73.0pt;" width="97"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">Discount on Deal</span></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 13.5pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 60.0pt;" width="80"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">16.36%</span></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 13.5pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 71.0pt;" width="95"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">51.30%</span></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 13.5pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 1.0in;" width="96"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">53.09%</span></div>
</td>
</tr>
<tr style="height: 12.75pt; mso-yfti-irow: 5;">
<td style="border-left: solid windowtext 1.0pt; border: none; height: 12.75pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 73.0pt;" width="97"><div align="center" class="MsoNormal" style="text-align: center;">
<br /></div>
</td>
<td colspan="3" style="border-right: solid black 1.0pt; border: none; height: 12.75pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 203.0pt;" width="271"><div align="center" class="MsoNormal" style="text-align: center;">
<br /></div>
</td>
</tr>
<tr style="height: 12.75pt; mso-yfti-irow: 6;">
<td style="border-right: none; border: solid windowtext 1.0pt; height: 12.75pt; mso-border-bottom-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext 1.0pt; mso-border-top-alt: solid windowtext 1.0pt; padding: 0in 5.4pt 0in 5.4pt; width: 73.0pt;" width="97"><div align="center" class="MsoNormal" style="text-align: center;">
<br /></div>
</td>
<td colspan="3" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid black 1.0pt; border-top: solid windowtext 1.0pt; height: 12.75pt; mso-border-bottom-alt: solid windowtext .5pt; mso-border-right-alt: solid black 1.0pt; mso-border-top-alt: solid windowtext 1.0pt; padding: 0in 5.4pt 0in 5.4pt; width: 203.0pt;" width="271"><div align="center" class="MsoNormal" style="text-align: center;">
<b><span style="font-family: Arial; font-size: 10pt;">Terminal Growth of 3%</span></b></div>
</td>
</tr>
<tr style="height: 12.75pt; mso-yfti-irow: 7;">
<td style="border-top: none; border: solid windowtext 1.0pt; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 73.0pt;" width="97"><div align="center" class="MsoNormal" style="text-align: center;">
<br /></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 60.0pt;" width="80"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">a</span></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 71.0pt;" width="95"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">b</span></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 1.0in;" width="96"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">c</span></div>
</td>
</tr>
<tr style="height: 38.25pt; mso-yfti-irow: 8;">
<td style="border-top: none; border: solid windowtext 1.0pt; height: 38.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext 1.0pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 73.0pt;" width="97"><div align="center" class="MsoNormal" style="text-align: center;">
<i><span style="font-family: Arial; font-size: 10pt;">EBITDA Margin</span></i></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 38.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 60.0pt;" width="80"><div align="center" class="MsoNormal" style="text-align: center;">
<i><span style="font-family: Arial; font-size: 10pt;">Fixed 22.5%</span></i></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 38.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 71.0pt;" width="95"><div class="MsoNormal">
<i><span style="font-family: Arial; font-size: 10pt;">Increasing
from 18% to 26% in 9 yrs</span></i></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 38.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-right-alt: solid windowtext 1.0pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 1.0in;" width="96"><div class="MsoNormal">
<i><span style="font-family: Arial; font-size: 10pt;">Increasing
from 20% to 26% in 9 yrs</span></i></div>
</td>
</tr>
<tr style="height: 26.25pt; mso-yfti-irow: 9;">
<td style="border-top: none; border: solid windowtext 1.0pt; height: 26.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext 1.0pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 73.0pt;" width="97"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">Valuation ($mn)</span></div>
</td>
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<span style="font-family: Arial; font-size: 10pt;">$561.50 </span></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 26.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 71.0pt;" width="95"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">$709.13 </span></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 26.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-right-alt: solid windowtext 1.0pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 1.0in;" width="96"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">$720.46 </span></div>
</td>
</tr>
<tr style="height: 26.25pt; mso-yfti-irow: 10; mso-yfti-lastrow: yes;">
<td style="border-top: none; border: solid windowtext 1.0pt; height: 26.25pt; mso-border-bottom-alt: 1.0pt; mso-border-color-alt: windowtext; mso-border-left-alt: 1.0pt; mso-border-right-alt: .5pt; mso-border-style-alt: solid; mso-border-top-alt: .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 73.0pt;" width="97"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">Discount on Deal</span></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 26.25pt; mso-border-alt: solid windowtext .5pt; mso-border-bottom-alt: solid windowtext 1.0pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 60.0pt;" width="80"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">-11.57%</span></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 26.25pt; mso-border-alt: solid windowtext .5pt; mso-border-bottom-alt: solid windowtext 1.0pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 71.0pt;" width="95"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">11.67%</span></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 26.25pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 1.0in;" width="96"><div align="center" class="MsoNormal" style="text-align: center;">
<span style="font-family: Arial; font-size: 10pt;">13.46%</span></div>
</td>
</tr>
</tbody></table>
</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
On considering a terminal growth of 5%, all valuation show
the deal gave Piramal a discount of at least 16.36%. But for a terminal growth
rate of 3%, in case of a fixed EBITDA margin of 22.5%, the value comes 11.57%
lower than the deal value, while for the rest it is above the deal size.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
All in all, the deal seams to be very lucrative, as the
analytics business generally has EBITDA margins in mid 20s. Moreover, my
calculations have considered lower EBITDA margins during initial phase of 9
years and maturing to 26% (which seems attainable to me). I have also not
considered the synergies between Piramal and DRG and the benefits of entering
the global Analytics industry (which is growing faster than the IT/ITES
industry).</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<i>Verdict: I still maintain a BUY on Piramal Healthcare and feel that
the company is employing its cash well.</i></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
[You can refer to my valuation excel sheet at: https://sites.google.com/site/saumitraambegaokar/drg] </div>
</div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-29200583066137988292012-06-20T14:17:00.001+05:302012-06-20T14:17:29.562+05:30Analysis of Navin Flourine International Ltd<div dir="ltr" style="text-align: left;" trbidi="on">
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<br />
<div class="MsoNormal">
A company giving Rs66.5 per share dividend in form of (final
+ special) dividend always attracts attention. Since its announcement it has
risen from 330 to 430 and post ex-date, it now trades at 305. Its P/E multiple shows
1.xx and it reported a fantastic result as follows:</div>
<div class="MsoNormal">
<br /></div>
<b><i style="mso-bidi-font-style: normal;">Navin Fluorine International
Limited</i></b><i style="mso-bidi-font-style: normal;">, a part of reputed
industrial house of Arvind Mafatlal Group, today reported a consolidated net
profit of<span class="webrupee"> Rs. </span>217.58 crore for the year ended March
31, 2012 as against<span class="webrupee"> Rs. </span>71.34 crore in
corresponding period of last fiscal year, registering an increase of 205 %.</i><br />
<i style="mso-bidi-font-style: normal;">Net Revenue for the year stood at<span class="webrupee"> Rs. </span>7.24bn, registering a growth of 68.23 % as compared
to<span class="webrupee"> Rs. </span>4.30bn posted the last fiscal year. Earnings
per share (EPS) increased by 214 % to<span class="webrupee"> Rs. </span>222.91 as
compared to<span class="webrupee"> Rs. </span>70.81 of the last fiscal year.</i><br />
<i style="mso-bidi-font-style: normal;">(source: http://www.indiainfoline.com/Markets/News/Navin-Fluorine-FY12-net-profit-jumps-68-percent/5407635849)</i><br />
<br />
<div class="MsoNormal">
The big question coming to my mind is: “Why then is this
stock not catching the imagination of the prudent investors?” The answer
becomes apparent on looking at its annual report.</div>
<div class="MsoNormal">
<br /></div>
<a name='more'></a><br />
<div class="MsoNormal">
The largest contributor to the profit was the sale of Carbon
credits, which grew from 78.33 crore to 251.09 crore. So, is this lucrative
revenue from the carbon credits to continue? The answer is NO. The same has
also been mentioned in their Annual Report. The European Union ETS has put a
ban on trading of Industrial Gas CERs, under which Navin Fluorine was making
the massive profits. Same has been done by NZ (New Zealand) ETS. The end result
being, beyond 31<sup>st</sup> Dec 2012, this source of revenue for the company
would dry up due to lack of a market. What would the books of the company look
like then?</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The following table contains my back of the envelope
calculations for the same. The operational sales are actual sales of the company
(excluding carbon credit sales). The cost of the process of breaking down HFC23
(the basis of getting the carbon credits) is minimal (lesser than a tenth of
the value of the carbon credit) and hence neglected. <span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
<div align="center">
<table border="0" cellpadding="0" cellspacing="0" class="MsoNormalTable" style="border-collapse: collapse; margin-left: -21.85pt; width: 325px;">
<tbody>
<tr style="height: 12.75pt; mso-yfti-firstrow: yes; mso-yfti-irow: 0;">
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 147.5pt;" valign="bottom" width="197">
<div class="MsoNormal">
<br /></div>
</td>
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64">
<div align="right" class="MsoNormal" style="text-align: right;">
<b style="mso-bidi-font-weight: normal;"><span style="font-family: Arial; font-size: 10.0pt;">2012</span></b></div>
</td>
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64">
<div align="right" class="MsoNormal" style="text-align: right;">
<b style="mso-bidi-font-weight: normal;"><span style="font-family: Arial; font-size: 10.0pt;">2011</span></b></div>
</td>
</tr>
<tr style="height: 12.75pt; mso-yfti-irow: 1;">
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 147.5pt;" valign="bottom" width="197">
<div class="MsoNormal">
<span style="font-family: Arial; font-size: 10.0pt;">Sales</span></div>
</td>
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64">
<div align="right" class="MsoNormal" style="text-align: right;">
<span style="font-family: Arial; font-size: 10.0pt;">703.86</span></div>
</td>
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64">
<div align="right" class="MsoNormal" style="text-align: right;">
<span style="font-family: Arial; font-size: 10.0pt;">430.74</span></div>
</td>
</tr>
<tr style="height: 12.75pt; mso-yfti-irow: 2;">
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 147.5pt;" valign="bottom" width="197">
<div class="MsoNormal">
<i><span style="font-family: Arial; font-size: 9.0pt; mso-bidi-font-size: 10.0pt;">Carbon Credit Sales</span></i></div>
</td>
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64">
<div align="right" class="MsoNormal" style="text-align: right;">
<i><span style="font-family: Arial; font-size: 9.0pt; mso-bidi-font-size: 10.0pt;">251.09</span></i></div>
</td>
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64">
<div align="right" class="MsoNormal" style="text-align: right;">
<i><span style="font-family: Arial; font-size: 9.0pt; mso-bidi-font-size: 10.0pt;">78.33</span></i></div>
</td>
</tr>
<tr style="height: 12.75pt; mso-yfti-irow: 3;">
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 147.5pt;" valign="bottom" width="197">
<div class="MsoNormal">
<span style="font-family: Arial; font-size: 10.0pt;">Operating
Sales (less CC)</span></div>
</td>
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64">
<div align="right" class="MsoNormal" style="text-align: right;">
<span style="font-family: Arial; font-size: 10.0pt;">452.77</span></div>
</td>
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64">
<div align="right" class="MsoNormal" style="text-align: right;">
<span style="font-family: Arial; font-size: 10.0pt;">352.41</span></div>
</td>
</tr>
<tr style="height: 12.75pt; mso-yfti-irow: 4;">
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 147.5pt;" valign="bottom" width="197">
<div class="MsoNormal">
<i style="mso-bidi-font-style: normal;"><span style="font-family: Arial; font-size: 9.0pt; mso-bidi-font-size: 10.0pt;">Cost of Sales</span></i></div>
</td>
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64">
<div align="right" class="MsoNormal" style="text-align: right;">
<i style="mso-bidi-font-style: normal;"><span style="font-family: Arial; font-size: 9.0pt; mso-bidi-font-size: 10.0pt;">486.16</span></i></div>
</td>
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64">
<div align="right" class="MsoNormal" style="text-align: right;">
<i style="mso-bidi-font-style: normal;"><span style="font-family: Arial; font-size: 9.0pt; mso-bidi-font-size: 10.0pt;">337.07</span></i></div>
</td>
</tr>
<tr style="height: 12.75pt; mso-yfti-irow: 5;">
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 147.5pt;" valign="bottom" width="197">
<div class="MsoNormal">
<span style="font-family: Arial; font-size: 10.0pt;">EBIT</span></div>
</td>
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64">
<div align="right" class="MsoNormal" style="text-align: right;">
<span style="font-family: Arial; font-size: 10.0pt;">-33.39</span></div>
</td>
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64">
<div align="right" class="MsoNormal" style="text-align: right;">
<span style="font-family: Arial; font-size: 10.0pt;">15.34</span></div>
</td>
</tr>
<tr style="height: 12.75pt; mso-yfti-irow: 6; mso-yfti-lastrow: yes;">
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 147.5pt;" valign="bottom" width="197">
<div class="MsoNormal">
<br /></div>
</td>
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64">
<div align="right" class="MsoNormal" style="text-align: right;">
<br /></div>
</td>
<td nowrap="nowrap" style="height: 12.75pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64">
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<br /></div>
</td>
</tr>
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<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Considering this, we observe the EBIT for this past year was
negative. For 3 quarters of FY13, they will still continue earning from this
source, thereby a handsome interim dividend may be expected, but after that it
all depends on how their expansion plans pay-off.</div>
<div class="MsoNormal">
My verdict is either hold your investment in the stock if
any and wait for the Q2 results after which you may sell the same if no other
significant development happens.</div>
</div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com1tag:blogger.com,1999:blog-1721882659798727251.post-20596446647688959282012-02-05T22:03:00.003+05:302012-02-05T22:03:48.807+05:30Piramal Healthcare’s 11% Vodafone Stake – Is it worth it?<div dir="ltr" style="text-align: left;" trbidi="on">
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<br />
<div class="MsoNormal" style="text-align: justify;">
Piramal Healthcare on Friday added
5.5% stake to Vodafone India to take its total shareholding in the telecom
major to 11%. Now, Piramal’s total investment in Vodafone i.e. telecom business
stands at Rs5870 crore. Considering this to be almost equivalent to a third of
the sale proceeds to Abbot, I wanted to estimate how much is Vodafone actually
worth (Neglecting the effect Supreme court ruling cancelling 2G licenses issued
in 2008 could have on its value). </div>
<div class="MsoNormal" style="text-align: justify;">
<br /></div>
<div class="MsoNormal" style="text-align: justify;">
Data used for the relative
valuation is taken from Vodafone Plc’s half yearly numbers, wherein Sales and
EBITDA of India operations was given. As for comparison, MarketCapitalization/Sales
and EV/EBITDA are considered. The comparable companies which have been taken
for this are Airtel, Idea, RComm and Tata Teleservices (TTML). The values for
the multiples as on 25<sup>th</sup> Jan 2012 were:</div>
<div class="MsoNormal" style="text-align: justify;">
<br /></div>
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<div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;">
<b style="mso-bidi-font-weight: normal;"><i style="mso-bidi-font-style: normal;"><span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">EV/EBITDA</span></i></b></div>
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<div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;">
<b style="mso-bidi-font-weight: normal;"><i style="mso-bidi-font-style: normal;"><span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">Mkt Cap/Sales</span></i></b></div>
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<div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;">
<i style="mso-bidi-font-style: normal;"><span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">Airtel</span></i></div>
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<div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;">
<span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">11.13</span></div>
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<div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;">
<span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">3.57</span></div>
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<div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;">
<i style="mso-bidi-font-style: normal;"><span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">Idea</span></i></div>
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<div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;">
<span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">10.79</span></div>
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<span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">1.45</span></div>
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<i style="mso-bidi-font-style: normal;"><span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">Rcomm</span></i></div>
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<td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 67.5pt;" valign="bottom" width="90">
<div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;">
<span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">31.54</span></div>
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<div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;">
<span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">1.67</span></div>
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<i style="mso-bidi-font-style: normal;"><span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">Tata Tele</span></i></div>
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<span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">6.78</span></div>
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<td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 1.0in;" valign="bottom" width="96">
<div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;">
<span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">1.44</span></div>
</td>
</tr>
<tr style="height: 12.0pt; mso-yfti-irow: 5; mso-yfti-lastrow: yes;">
<td nowrap="nowrap" style="border-top: none; border: solid windowtext 1.0pt; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 90.75pt;" valign="bottom" width="121">
<div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;">
<b><span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">Average</span></b></div>
</td>
<td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 67.5pt;" valign="bottom" width="90">
<div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;">
<b><i style="mso-bidi-font-style: normal;"><span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">9.57*</span></i></b></div>
</td>
<td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 1.0in;" valign="bottom" width="96">
<div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; page-break-after: avoid; text-align: center;">
<b><i style="mso-bidi-font-style: normal;"><span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">2.03</span></i></b></div>
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<div align="center" class="MsoCaption" style="text-align: center;">
</div>
<a name='more'></a><br />
<div class="MsoNormal" style="text-align: justify;">
For EV/EBITDA calculations, RComm’s
value is not taken, as it is disproportionately large. For MarketCap/Sales, all
values are taken. Based upon these multiples and the annualised sales and
EBITDA for this year based on H1 figures, we find the value of Vodafone as
shown below:</div>
<div class="MsoNormal" style="text-align: justify;">
<br /></div>
<div align="center">
<table border="1" cellpadding="0" cellspacing="0" class="MsoNormalTable" style="border-collapse: collapse; border: medium none; margin-left: 4.65pt; width: 418px;">
<tbody>
<tr style="height: 12.0pt; mso-yfti-firstrow: yes; mso-yfti-irow: 0;">
<td nowrap="nowrap" style="border: solid windowtext 1.0pt; height: 12.0pt; mso-border-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 147.0pt;" valign="bottom" width="196">
<div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;">
<i style="mso-bidi-font-style: normal;"><span style="font-family: "Geneva","serif"; font-size: 8.0pt; mso-bidi-font-family: "Times New Roman"; mso-bidi-font-size: 9.0pt; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">All figures in Crore</span></i></div>
</td>
<td nowrap="nowrap" style="border-left: none; border: solid windowtext 1.0pt; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 57.0pt;" valign="bottom" width="76">
<div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;">
<b style="mso-bidi-font-weight: normal;"><span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">Rs Crore</span></b></div>
</td>
<td nowrap="nowrap" style="border-left: none; border: solid windowtext 1.0pt; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.35pt;" valign="bottom" width="64">
<div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;">
<b style="mso-bidi-font-weight: normal;"><span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">Value</span></b></div>
</td>
<td nowrap="nowrap" style="border-left: none; border: solid windowtext 1.0pt; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 61.4pt;" valign="bottom" width="82">
<div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;">
<b style="mso-bidi-font-weight: normal;"><span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">Value of
11% stake</span></b></div>
</td>
</tr>
<tr style="height: 12.0pt; mso-yfti-irow: 1;">
<td nowrap="nowrap" style="border-top: none; border: solid windowtext 1.0pt; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 147.0pt;" valign="bottom" width="196">
<div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;">
<span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">Sales</span></div>
</td>
<td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 57.0pt;" valign="bottom" width="76">
<div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;">
<span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">33109.88</span></div>
</td>
<td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.35pt;" valign="bottom" width="64">
<div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;">
<span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">67295.83</span></div>
</td>
<td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 61.4pt;" valign="bottom" width="82">
<div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;">
<b style="mso-bidi-font-weight: normal;"><i style="mso-bidi-font-style: normal;"><span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">7402.541</span></i></b></div>
</td>
</tr>
<tr style="height: 12.0pt; mso-yfti-irow: 2; mso-yfti-lastrow: yes;">
<td nowrap="nowrap" style="border-top: none; border: solid windowtext 1.0pt; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 147.0pt;" valign="bottom" width="196">
<div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;">
<span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">EBITDA</span></div>
</td>
<td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 57.0pt;" valign="bottom" width="76">
<div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;">
<span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">8367.4</span></div>
</td>
<td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.35pt;" valign="bottom" width="64">
<div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;">
<span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">80048.13</span></div>
</td>
<td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 61.4pt;" valign="bottom" width="82">
<div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;">
<b style="mso-bidi-font-weight: normal;"><i style="mso-bidi-font-style: normal;"><span style="font-family: "Geneva","serif"; font-size: 9.0pt; mso-bidi-font-family: "Times New Roman"; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-IN;">8805.294</span></i></b></div>
</td>
</tr>
</tbody></table>
</div>
<div class="MsoNormal" style="text-align: justify;">
<br /></div>
<div class="MsoNormal" style="text-align: justify;">
So, the average valuation (based
upon the multiples) indicates Piramal Healthcare received a discount close to 27.6%
through the two deals. </div>
<div class="MsoNormal" style="text-align: justify;">
<br /></div>
<div class="MsoNormal" style="text-align: justify;">
Another indicator that may be
used to judge the value of Vodafone India is Essar’s stake sale to Vodafone.
Last October, when Essar exercised its option to sell its 22% stake to Vodafone
for $3.3bn, it valued the company at $15bn. Similarly, based upon our multiples
valuation, the value of Vodafone comes out to be around $14.7bn (average of the
two values obtained). On the other hand, Piramal’s 11% investment in Vodafone
for Rs5867 crore values the company at $10.66bn, which is at 28.9% discount to
the Vodafone deal. Moreover the EBITDA of Vodafone India is growing at around 14%.</div>
<div class="MsoNormal" style="text-align: justify;">
<br /></div>
<div class="MsoNormal" style="text-align: justify;">
Based upon these valuations, it
seems Piramal Healthcare got a good deal for the Vodafone Investment.</div>
</div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com3tag:blogger.com,1999:blog-1721882659798727251.post-21396532074631046692012-02-01T18:33:00.006+05:302012-02-01T18:33:57.116+05:30Mahindra Satyam Ltd Results – What to expect tomorrow?<div dir="ltr" style="text-align: left;" trbidi="on">
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<br />
<div class="MsoNormal">
Satyam came out with their Q3 results after the end of
trading today. The salient points in their result are:</div>
<ol style="text-align: left;">
<li><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;"></span></span>Consolidated Revenue up 34% YoY and 9% QoQ at Rs1718
Crore</li>
<li><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;"><span style="font: 7.0pt "Times New Roman";"></span></span></span>Consolidated PAT stood at Rs 308 Crore, a rise
of 29% QoQ and 424% YoY</li>
</ol>
<div class="MsoNormal">
A major point to be noted is that the pre-tax “Other Income”
surged by 56.4% to Rs 151.3 crore. The EBITDA stood at increased by a
relatively modest 15.1%. The EPS for Q3 was reported at Rs 2.62. The nine month
EPS stood at Rs 6.56. In absence of Q4 guidance, for a back-of-the-envelope
calculation, if we annualise this EPS, we get an EPS of Rs 8.75. But on the
other hand, if a performance equivalent to this quarter were to come (flat QoQ
growth), then the EPS for the year ending March 2012 would stand at Rs 9.18. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Now, the IT industry average P/E multiple is around 20, while
at the present annualised P/E multiple, Satyam trades at 8.7. Considering the
P/E multiple based upon the H1 EPS which stood at 2.52 (Annualised value of Rs 5.04),
the stock was trading at a multiple of 15. With the better results for the
company in the last quarter (EPS for Q3 was greater than that of H1 combined)
the stock would be trading at a far lower multiple of 9 if it does not grow
tomorrow.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Hence, I would buy Satyam and set a target of Rs 100-110
(When a current P/E multiple of 12-13 would be achieved).</div>
</div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-17951288298807454122012-01-13T01:06:00.000+05:302012-01-13T01:07:06.251+05:30Infosys Q3 FY12 Results – Is the 8.4% fall justified?<div dir="ltr" style="text-align: left;" trbidi="on">
<div style="font-family: inherit;">
</div>
<div class="Default" style="font-family: inherit;">
<span style="font-size: small;">Consolidated results for the
quarter ended December 31, 2011 were reported by Infosys today. The highlights
of the same are:</span></div>
<div class="Default" style="font-family: inherit;">
<br /></div>
<div class="Default" style="font-family: inherit; margin-bottom: 8.65pt;">
<span style="font-size: small;">1)
Revenues were Rs 9,298
crore for the quarter ended December 31, 2011; QoQ growth was 14.8%; YoY growth
was 30.8% </span></div>
<div class="Default" style="font-family: inherit; margin-bottom: 8.65pt;">
<span style="font-size: small;">2)
Net profit after tax was Rs 2,372
crore for the quarter ended December 31, 2011; QoQ growth was 24.4%; YoY growth
was 33.3% </span></div>
<div class="Default" style="font-family: inherit;">
<span style="font-size: small;">3) Earnings per share (EPS) was Rs 41.51
for the quarter ended December 31, 2011; QoQ growth was 24.4%; YoY growth was
33.3% </span></div>
<div class="MsoNormal" style="font-family: inherit;">
<br /></div>
<div class="MsoNormal" style="font-family: inherit;">
<span style="font-size: small;">The results beat most of the market expectation. But the
flat earnings projection (QoQ) for the last quarter of the year owing to
volatile economic environment especially in the Euro zone dampened the mood and
the stock of the company fell 8.4% by the end of the trading session. Now the
question is: Is this fall justified?</span></div>
<div class="MsoNormal" style="font-family: inherit;">
<span style="font-size: small;">Let us take a look at the Q4 guidance given by Infosys:</span></div>
<div class="Default" style="font-family: inherit; margin: 0in 0in 8.5pt 0.5in; text-indent: -0.25in;">
<span style="font-size: small;">1)<span style="-moz-font-feature-settings: normal; -moz-font-language-override: normal; font-size-adjust: none; font-stretch: normal; font-style: normal; font-variant: normal; font-weight: normal; line-height: normal;"> </span>Revenues are expected to be in the range of Rs 9,391 crore and Rs 9,412 crore</span></div>
<div class="Default" style="font-family: inherit; margin-left: 0.5in; text-indent: -0.25in;">
<span style="font-size: small;">2)<span style="-moz-font-feature-settings: normal; -moz-font-language-override: normal; font-size-adjust: none; font-stretch: normal; font-style: normal; font-variant: normal; font-weight: normal; line-height: normal;"> </span>Earnings per share (EPS) is expected to be Rs 42.12</span></div>
<div class="MsoNormal" style="font-family: inherit;">
<br /></div>
<div class="MsoNormal" style="font-family: inherit; text-align: justify;">
<span style="font-size: small;">Although this is almost flat QoQ,
but if we consider the YoY implications of this guidance, revenues are expected
to <span style="line-height: 115%;">grow by 29.5% to 29.8% and
EPS by 32.4%. This is a rather impressive YoY growth which was last seen during
FY2008-09 for Infosys. For the past two years, the EPS growth was rather
sluggish as compared to this. But is this stock fall owing to a drastic
reduction in value of the company?</span></span></div>
<div class="MsoNormal" style="font-family: inherit; text-align: justify;">
<br /></div>
<a name='more'></a><div style="font-family: inherit;">
<br /></div>
<div class="MsoNormal" style="font-family: inherit; text-align: justify;">
<span style="font-size: small;"><span style="line-height: 115%;"></span></span></div>
<div style="font-family: inherit;">
<span style="font-size: small;">
</span></div>
<div class="MsoNormal" style="font-family: inherit; text-align: justify;">
<span style="font-size: small;"><span style="line-height: 115%;">Let us consider a simple P/E multiple based valuation of the
stock. As per the FY12 guidance, the EPS
for the period FY12 would stand at Rs 147.13 per share. Also, the market based
consensus for Q4 EPS estimate was Rs 43.68 per share (<a href="http://finance.yahoo.com/news/Infosys-tumbles-Q4-guidance-theflyonthewall-691393143.html?x=0">http://finance.yahoo.com/news/Infosys-tumbles-Q4-guidance-theflyonthewall-691393143.html?x=0</a>
assuming USD/INR = 52), which implied a year end EPS of Rs 148.69 per share.</span></span></div>
<div class="MsoNormal" style="font-family: inherit; text-align: justify;">
<br /></div>
<div style="font-family: inherit;">
<span style="font-size: small;">
</span></div>
<div class="MsoNormal" style="font-family: inherit; text-align: justify;">
<span style="font-size: small;"><span style="line-height: 115%;">Let us assume that the market price as on 11<sup>th</sup> Jan
(before the result announcement) was in accordance with these estimates. Q1 and
Q2 figures were already known and Q3 EPS figures were in line with the market
consensus. So, whatever fall that occurred was owing to the lower guidance. So,
forward looking P/E multiple as on 11<sup>th</sup> would have been 19 (Closing
price of 2826 divided by 148.69). After the fall, the forward looking P/E
multiple stands at 17.59 (12<sup>th</sup> Jan closing price of 2588.6 divided
by 147.13). This indicates a lowering down of P/E multiple. This indicates
lowering of confidence in IT industry and not just Infosys.</span></span></div>
<div class="MsoNormal" style="font-family: inherit; text-align: justify;">
<br /></div>
<div style="font-family: inherit;">
<span style="font-size: small;">
</span></div>
<div class="MsoNormal" style="font-family: inherit; text-align: justify;">
<span style="font-size: small;"><span style="line-height: 115%;">So, if you feel that scenario for IT industry as a whole has
worsened in the past few days and that is why, the price of Infosys should
fall, then stay out of the stock.</span></span></div>
<div class="MsoNormal" style="font-family: inherit; text-align: justify;">
<br /></div>
<div style="font-family: inherit;">
<span style="font-size: small;">
</span></div>
<div class="MsoNormal" style="font-family: inherit; text-align: justify;">
<span style="font-size: small;"><span style="line-height: 115%;">On the other hand, if IT industry scenario has not changed in
the past two days (my own view is along these lines), then the drastic fall in
the price of Infosys seems to be an overreaction to the lower guidance figure.
Based upon that, I would keep a target of Rs 2800 (147.13*19 = 2795) for
Infosys. </span></span></div>
</div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-13737322571438304482011-08-04T20:12:00.000+05:302011-08-04T20:12:37.143+05:30Analysis of Piramal Healthcare Ltd<div dir="ltr" style="text-align: left;" trbidi="on">Piramal Healthcare, in their Analyst presentation came out with their future strategy of utilizing their cash. As mentioned in my earlier post, they are sitting on almost Rs 10,000 crore cash/cash equivalent. With the sale of the Domestic Formulations business, there was some anxiety as to which business would Mr Piramal decide to invest the money in.<br />
<br />
The major focus of the investments lies in four areas as follows:<br />
<br />
<b>1) </b><b>Pharma Solutions</b><br />
Investment: Rs 2,700 Crore<br />
Current Sales: Rs 1020 Crore <br />
Sales Target: Rs 5,000 Crore by 2016 (CAGR of 37%)<br />
<br />
They aim to be among the top-3 contract manufacturing organizations globally.<br />
<br />
<a name='more'></a><br />
<br />
<b>2) Critical Care</b><br />
Investments: Rs 1500 Crore<br />
Current Sales: Rs 388 Crore<br />
Sales Target: Rs 2,000 Crore by 2016 (CAGR of 39%)<br />
<br />
They aim to be among the top-2 anesthetic companies globally.<br />
<br />
3) OTC<br />
Investments: Rs 2,500 Crore<br />
Current Sales: Rs 125 Crore<br />
<br />
Sales Target: Rs 1000 Crore by 2016 (CAGR of 52%)<br />
<br />
Among top 3 companies in India by 2016 (Currently in to 10)<br />
<br />
4) Life Sciences <br />
Investments: Rs 600 Crore<br />
Current Sales: (Yet to be merged into PHL)<br />
Sales Target: (High potential, they hope to launch their first drug (for cancer) by 2014)<br />
<br />
Over and above this, they will be investing heavily in PHL Capital. The money left out will be used to invest in minority stake investments.<br />
<br />
The growth they are targeting would be achieved through a combination of organic and inorganic route. With the monetary power of going forward towards this target, PHL seems to be poised for a high growth trajectory.<br />
<br />
In the Analyst Presentation they set a sales target of Rs 10,000 Crore for FY2016. Based upon that and the other information that has been posted here, I have made some earnings estimates for PHL.<br />
<br />
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" /><br />
<br />
So, if we consider a P/E ratio of 20, the price by the end of 2016 could reach around Rs 1662. This is a relatively conservative estimate, given the P/E multiple of the current top 5 market cap pharmaceutical companies is well above 20 (With that of Sun Pharma being close to 37).</div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-11714446577579795752011-07-28T00:43:00.001+05:302011-07-28T01:19:31.492+05:30Analysis of L&T Finance IPO<div dir="ltr" style="text-align: left;" trbidi="on"><div class="MsoNormal">L&T Finance has generated quite a bit of hype for its IPO. Due to lack of time, I have not been able to make a better study of the same and hence valuation. Hence, I will restrict myself to a relative valuation this time around.</div><div class="MsoNormal"><br />
</div><div class="MsoNormal">For this purpose, I shall use the companies that they have mentioned in the RHP. The various figures for them is mentioned below.</div><div class="MsoNormal"><br />
</div><table border="1" cellpadding="0" cellspacing="0" class="MsoNormalTable" style="border-collapse: collapse; border: medium none; margin-left: 4.65pt; width: 547px;"><tbody>
<tr style="height: 51.0pt; mso-yfti-firstrow: yes; mso-yfti-irow: 0;"> <td nowrap="nowrap" style="border: solid windowtext 1.0pt; height: 51.0pt; mso-border-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 117.75pt;" valign="bottom" width="157"><br />
</td> <td nowrap="nowrap" style="border-left: none; border: solid windowtext 1.0pt; height: 51.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" width="60"><div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">EPS</span></b></div></td> <td style="border-left: none; border: solid windowtext 1.0pt; height: 51.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: .75in;" width="72"><div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">Price (as on 27/07/11)</span></b></div></td> <td nowrap="nowrap" style="border-left: none; border: solid windowtext 1.0pt; height: 51.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 49.5pt;" width="66"><div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">P/E</span></b></div></td> <td nowrap="nowrap" style="border-left: none; border: solid windowtext 1.0pt; height: 51.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" width="60"><div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">RONW </span></b></div></td> <td style="border-left: none; border: solid windowtext 1.0pt; height: 51.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 58.5pt;" width="78"><div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">Book Value(BV) Per Share</span></b></div></td> <td nowrap="nowrap" style="border-left: none; border: solid windowtext 1.0pt; height: 51.0pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 40.5pt;" width="54"><div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">P/BV</span></b></div></td> </tr>
<tr style="height: 12.75pt; mso-yfti-irow: 1;"> <td nowrap="nowrap" style="border-top: none; border: solid windowtext 1.0pt; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 117.75pt;" valign="bottom" width="157"><div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">Shriram Trans. Fin.</span></b></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" valign="bottom" width="60"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">53.92</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: .75in;" valign="bottom" width="72"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">665.90</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 49.5pt;" valign="bottom" width="66"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">12.35</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" valign="bottom" width="60"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">24.87%</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 58.5pt;" valign="bottom" width="78"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">216.37</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 40.5pt;" valign="bottom" width="54"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">3.08</span></div></td> </tr>
<tr style="height: 12.75pt; mso-yfti-irow: 2;"> <td nowrap="nowrap" style="border-top: none; border: solid windowtext 1.0pt; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 117.75pt;" valign="bottom" width="157"><div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">M&M Financial Serv.</span></b></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" valign="bottom" width="60"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">50.92</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: .75in;" valign="bottom" width="72"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">689.95</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 49.5pt;" valign="bottom" width="66"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">13.55</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" valign="bottom" width="60"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">19.36%</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 58.5pt;" valign="bottom" width="78"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">244.70</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 40.5pt;" valign="bottom" width="54"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">2.82</span></div></td> </tr>
<tr style="height: 12.75pt; mso-yfti-irow: 3;"> <td nowrap="nowrap" style="border-top: none; border: solid windowtext 1.0pt; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 117.75pt;" valign="bottom" width="157"><div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">IDFC</span></b></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" valign="bottom" width="60"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">8.77</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: .75in;" valign="bottom" width="72"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">133.70</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 49.5pt;" valign="bottom" width="66"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">15.25</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" valign="bottom" width="60"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">11.39%</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 58.5pt;" valign="bottom" width="78"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">76.97</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 40.5pt;" valign="bottom" width="54"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">1.74</span></div></td> </tr>
<tr style="height: 12.75pt; mso-yfti-irow: 4;"> <td nowrap="nowrap" style="border-top: none; border: solid windowtext 1.0pt; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 117.75pt;" valign="bottom" width="157"><div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">Rural Elect. Co</span></b></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" valign="bottom" width="60"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">26.18</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: .75in;" valign="bottom" width="72"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">213.60</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 49.5pt;" valign="bottom" width="66"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">8.16</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" valign="bottom" width="60"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">20.15%</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 58.5pt;" valign="bottom" width="78"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">129.90</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 40.5pt;" valign="bottom" width="54"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">1.64</span></div></td> </tr>
<tr style="height: 12.75pt; mso-yfti-irow: 5;"> <td nowrap="nowrap" style="border-top: none; border: solid windowtext 1.0pt; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 117.75pt;" valign="bottom" width="157"><div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">PFC</span></b></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" valign="bottom" width="60"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">23.06</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: .75in;" valign="bottom" width="72"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">192.50</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 49.5pt;" valign="bottom" width="66"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">8.35</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" valign="bottom" width="60"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">17.37%</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 58.5pt;" valign="bottom" width="78"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">132.79</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 40.5pt;" valign="bottom" width="54"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">1.45</span></div></td> </tr>
<tr style="height: 12.75pt; mso-yfti-irow: 6;"> <td nowrap="nowrap" style="border-top: none; border: solid windowtext 1.0pt; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 117.75pt;" valign="bottom" width="157"><div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">Sundaram Finance</span></b></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" valign="bottom" width="60"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">70.01</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: .75in;" valign="bottom" width="72"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">570.05</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 49.5pt;" valign="bottom" width="66"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">8.14</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" valign="bottom" width="60"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">21.53%</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 58.5pt;" valign="bottom" width="78"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">325.22</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 40.5pt;" valign="bottom" width="54"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">1.75</span></div></td> </tr>
<tr style="height: 12.75pt; mso-yfti-irow: 7; mso-yfti-lastrow: yes;"> <td nowrap="nowrap" style="border-top: none; border: solid windowtext 1.0pt; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 117.75pt;" valign="bottom" width="157"><div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">L&T Finance</span></b></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" valign="bottom" width="60"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">2.87</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: .75in;" valign="bottom" width="72"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">59</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 49.5pt;" valign="bottom" width="66"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">20.56</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 45.0pt;" valign="bottom" width="60"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">13.58%</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 58.5pt;" valign="bottom" width="78"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">20.4</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 40.5pt;" valign="bottom" width="54"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">2.89</span></div></td> </tr>
</tbody></table><div class="MsoNormal" style="margin-top: 12.0pt;"><br />
<a name='more'></a>No, if we consider that the issue gets listed at the upper limit (as has been the trend in recent times), then L&T Finance has a P/E ratio greater than any of the peers that they mentioned in the RHP. What more, the closest anyone comes to it is IDFC, trading at a multiple of 15.25 times earnings. Although the P/BV is not so bad if we consider the same price of Rs 59. This in turn shows an important fact: The low RONW. Among the group L&T Finance has the second lowest RONW. The next highest is at 17.37% to its 13.58%.</div><div class="MsoNormal" style="margin-top: 12.0pt;">The higher price may reflect a very important assumption – a faster growth in earnings than its peers. This may in turn increase the RONW in the coming years. When I took a look at that, L&T Finance’s profits surged by 49.26% Y-o-Y for FY11. Compared to this, M&M Financial services’ profit surged by 35.13%, Shriram Transport Finance’s by 40.86% and IDFC’s by 26.09%. If we assume (for argument sake, these growth rates may not be replicated, but the actual growth rates might be in proportion to these), then we get the following result:</div><div class="MsoNormal" style="margin-top: 12pt;"><br />
</div><table border="1" cellpadding="0" cellspacing="0" class="MsoNormalTable" style="border-collapse: collapse; border: medium none; margin-left: 4.65pt; width: 359px;"><tbody>
<tr style="height: 38.25pt; mso-yfti-firstrow: yes; mso-yfti-irow: 0;"> <td nowrap="nowrap" style="border: solid windowtext 1.0pt; height: 38.25pt; mso-border-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 129.35pt;" valign="bottom" width="172"><br />
</td> <td nowrap="nowrap" style="border-left: none; border: solid windowtext 1.0pt; height: 38.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" width="64"><div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">EPS</span></b></div></td> <td style="border-left: none; border: solid windowtext 1.0pt; height: 38.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 43.8pt;" width="58"><div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">Price (as on 27/07/11)</span></b></div></td> <td nowrap="nowrap" style="border-left: none; border: solid windowtext 1.0pt; height: 38.25pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" width="64"><div align="center" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: center;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">Fwd looking P/E</span></b></div></td> </tr>
<tr style="height: 12.75pt; mso-yfti-irow: 1;"> <td nowrap="nowrap" style="border-top: none; border: solid windowtext 1.0pt; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 129.35pt;" valign="bottom" width="172"><div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">Shriram Transport Finance</span></b></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">75.488</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 43.8pt;" valign="bottom" width="58"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">665.90</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">8.82</span></div></td> </tr>
<tr style="height: 12.75pt; mso-yfti-irow: 2;"> <td nowrap="nowrap" style="border-top: none; border: solid windowtext 1.0pt; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 129.35pt;" valign="bottom" width="172"><div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">M&M Financial Services</span></b></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">68.742</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 43.8pt;" valign="bottom" width="58"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">689.95</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">10.04</span></div></td> </tr>
<tr style="height: 12.75pt; mso-yfti-irow: 3;"> <td nowrap="nowrap" style="border-top: none; border: solid windowtext 1.0pt; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 129.35pt;" valign="bottom" width="172"><div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">IDFC</span></b></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">11.0502</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 43.8pt;" valign="bottom" width="58"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">133.70</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">12.10</span></div></td> </tr>
<tr style="height: 12.75pt; mso-yfti-irow: 4; mso-yfti-lastrow: yes;"> <td nowrap="nowrap" style="border-top: none; border: solid windowtext 1.0pt; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 129.35pt;" valign="bottom" width="172"><div class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in;"><b><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">L&T Finance</span></b></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">4.305</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 43.8pt;" valign="bottom" width="58"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">59</span></div></td> <td nowrap="nowrap" style="border-bottom: solid windowtext 1.0pt; border-left: none; border-right: solid windowtext 1.0pt; border-top: none; height: 12.75pt; mso-border-alt: solid windowtext .5pt; mso-border-left-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt; padding: 0in 5.4pt 0in 5.4pt; width: 48.0pt;" valign="bottom" width="64"><div align="right" class="MsoNormal" style="line-height: normal; margin-bottom: .0001pt; margin-bottom: 0in; text-align: right;"><span style="color: black; font-family: "Arial","sans-serif"; font-size: 10pt;">13.70</span></div></td> </tr>
</tbody></table><div class="MsoNormal" style="margin-top: 12.0pt;">Based on this, the price does not seem too high. What more, in a preferential allocation of shares in September 2010, L&T invested Rs 425 crore at Rs 67 per share.</div><div class="MsoNormal" style="margin-top: 12.0pt;">Although this is not a straightaway value pick according to me, but you can still put some money in it.</div></div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-57553423220175974032011-07-27T01:44:00.002+05:302011-07-27T11:14:02.354+05:30Analysis of Great Offshore Ltd Results<div dir="ltr" style="text-align: left;" trbidi="on"><br />
<div class="MsoNormal">I was pleasantly surprised when Great Offshore came out with the results today stating their net profit was up from Rs 26.73 Cr to Rs 54.90 Cr, a whopping 105% growth Y-o-Y. Amidst the relatively poor showing by the industry in the recent past, this seemed a silver lining. But on closer inspection, these clouds of delight evaporated.</div><div class="MsoNormal"><br />
</div><div class="MsoNormal">Their income from operations was down from Rs 235.9 Cr to Rs 218.59 Cr. But the contributor to their bottom line was not their operations, but profit from sales of vessels, which amounted to Rs 47.85 Cr before tax. Now if we remove this figure from the PBT, the amount goes down from Rs 92.9 Cr to Rs 45.05 Cr. And this is excluding the taxes. If we consider 40% corporate tax (the amount by which they deducted their tax), the PAT comes down to Rs 27.03 Cr.</div><div class="MsoNormal"><br />
</div><div class="MsoNormal">Thus, the actual growth of the company was by a marginal 1.12%. Considering this, their EPS for Q1 was 7.26. The stock of the company was down by 1.05% at 211.85, trading at a current PE multiple of 7.29, which considering the lack of significant operational growth can be justified.</div><div class="MsoNormal"><br />
</div><div class="MsoNormal">For the moment, I would rather stay away from this stock.</div></div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-58355013106233199692011-07-26T21:32:00.000+05:302011-07-26T21:32:36.520+05:30Analysis of Opto Circuits India Ltd Results<div dir="ltr" style="text-align: left;" trbidi="on"><br />
<div class="MsoNormal">Opto Circuits India Ltd is a medical equipment manufacturer with presence in India and Abroad. The Q1 results for the same were exceedingly good. On a Y-o-Y standalone basis, net profit increased marginally from Rs 56.95 Cr to Rs 57.13 Cr. But the more attractive figures come from the consolidated results. The net profit has increased from Rs 83.09 Cr to Rs 116.38 Cr (Y-o-Y). This has led to an EPS increase from Rs 4.46 to Rs 6.24.</div><div class="MsoNormal"><br />
</div><div class="MsoNormal">Opto Circuits India Ltd, in itself has not grown much and is itself purely in healthcare segment. But the subsidiaries are more attractive with interests in IT as well. The most important information out of the results is the exceedingly good performance by the subsidiaries. The profit from the subsidiaries has increased from Rs 26.14 Cr to Rs 59.25 Cr, indicating a whopping growth of 126%. The International Health care business has reported a significant gain in revenues by almost 51%. </div><div class="MsoNormal"><br />
</div><div class="MsoNormal">The most significant concern for the company could be exchange rate risk, as the majority of the sales as well as the profits come from the international business. Profits from domestic segment as well as the margins here are very small.</div><div class="MsoNormal"><br />
</div><div class="MsoNormal">The current EPS (I assume it to be 4 times latest EPS) is 24.96. This means that the stock is currently trading at a PE multiple of around 11, which is very low as compared to the industry (20.8). Moreover, for such a growth rate that they are experiencing, Opto Circuits may be considered a value buy.</div><div class="MsoNormal"><br />
</div><div class="MsoNormal">I will post a better analysis as soon as I get their annual report for FY2010-11 and have a look at their balance sheet.</div></div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-43152109446291903192011-07-22T11:13:00.001+05:302011-07-28T01:20:53.899+05:30Analysis of Biocon Ltd Results<div dir="ltr" style="text-align: left;" trbidi="on">When I first saw the FY11 Q1 results of Biocon, I was really disappointed. But on taking a closer look, there were some positives as well. Although the standalone net profit was down from Rs 72.3 crores to Rs 60.4 crores, their consolidated net profit from continuing operations (their subsidiary had sold its subsidiary) was marginally up by 7% from Rs 65.22 crore to Rs 70.05 crore. These figures indicate two important things:<br />
<br />
1) The domestic profitability has taken a hit<br />
2) The subsidiaries, many of whom are foreign, have turned profitable<br />
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<a name='more'></a><br />
<br />
If we take a look at Q1 FY10 results, the standalone profit was Rs 72.3 crores as against a consolidated profit of Rs 65.22 crores. This indicates that the continuing operations of their subsidiaries had lost a total of almost Rs 7 crore, as against a profit of almost Rs 10 crore this year (Rs 60.4 Cr of standalone profit as against Rs 70.05 Cr standalone profit).<br />
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Another positive came from the segment results. The profits from CRAMS had increased almost two folds from Rs 14.6 Cr to Rs 27.99 Cr. This shows a significant increase in a very promising business area. <br />
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Despite these small positives, the result has been very disappointing, especially if you compare it QoQ instead of YoY. But I will still stay bullish on Biocon and would suggest to buy some shares when it falls further (Below 340).</div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-10146240116218491212011-07-19T21:28:00.003+05:302011-07-28T01:20:30.871+05:30Analysis of Piramal Healthcare Ltd<div dir="ltr" style="text-align: left;" trbidi="on">When I decided to value Piramal Healthcare (PHL), a question came to my mind: "How do you value a company that is sitting on a cash pile of Rs 596 per share, when it is trading at Rs 403 per share?"<br />
<br />
With such a strong cash position and the current EPS (of the business remaining after the Abbott sale) being 39.2 (4xEPS of Q4), the current P/E ratio of the company is 10.3. Such a P/E ratio for a company, with a proven track record is significantly lower than its peers (with equivalent track record). Such a low P/E multiple indicates that the <i>'market'</i> does not expect the company to grow significantly in the future, which is unlikely considering their management track record.<br />
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<a name='more'></a><br />
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Moreover, they are also not considering the large cash pile. A 10.3x PE multiple is understandable, but the Rs 596 cash that is lying around in the coffers of the company is definitely being neglected. The potential of the utility of the cash definitely being forgotten.<br />
<br />
If the company in the future (maybe a year or two down the line, when it utilizes the above mentioned cash in some venture) is able to get an ROCE of 10%, that means, an additional earnings per share of Rs 59.6. We are not considering the potential of the financial leverage here. Moreover, we are also not considering the past performance given by the same management team: a minimum of 20% ROCE (upto 29%) in the past 5 years.<br />
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The book value per share of the company is also currently Rs 723. This is over 75% higher than the last traded price of the share. Piramal Healthcare has already entered the Financial Services business with the takeover of IndiaReit. With the merger of the New Chemical entity division into PHL, the new drug discovery front also looks promising as the risk profile of the R&D activity has also decreased a lot since the original demerger in 2007 (Owing to the molecules being higher up in the clinical trial process).<br />
<br />
The potential for PHL seems great from my point of view.<br />
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P.S. There is a dividend of Rs 12 per share coming up this august. The dividend yield is almost 3%, tax free.</div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com1tag:blogger.com,1999:blog-1721882659798727251.post-52026212068736512762011-07-05T22:28:00.001+05:302011-07-06T23:17:05.240+05:30Valuation of Biocon Ltd<div dir="ltr" style="text-align: left;" trbidi="on">Valuation of a company is not a straightforward task. There is no particular formula that will give a fixed value for the share of the company. I have tried using DCF (Discounted Cash Flow) method for valuing Biocon Ltd.<br />
<br />
In the process of arriving at a particular value, several assumptions are required to be taken. I have tried to keep those assumptions as conservative as possible. The assumption for the same are as follows:<br />
<br />
1) CAGR of Sales for the next 5 yrs: 25% (The past 5 yr average for Biocon is 28%, with growth touching 40% in the yr before last)<br />
<br />
2) Target Operating Profit Margin of 20% (Past 5 yr avg for Biocon is over 25%. Most of the global players have the same closer to 30%)<br />
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3) Sales to capital ratio: 1.16 (Past 5 yr average for Biocon)<br />
<br />
4) As the debt ratio of Biocon is very low (less than 0.1), for simplicity, I have taken the cost of capital as the cost of equity, which I obtained using the CAPM model.<br />
<br />
5) The terminal value of the return on capital is assumed to be 15.5%. This is much lower than current ROIC of Biocon which is 22%<br />
<br />
6) I have considered tax rate as 34% [as Biocon is a domestic company. This rate is supposed to further go down after implementation of the Direct Tax Code]<br />
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Considering the above mentioned assumptions, the final value I obtained for Biocon Share was Rs 435. The valuation depends a lot on the assumptions, but I believe the assumption that I have considered for the valuation of Biocon are conservative.<br />
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Excel sheet containing the calculation: <a href="https://sites.google.com/site/saumitraambegaokar/biocon-valuation">Biocon Valuation</a><br />
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If you have any comments, please shoot :)</div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com3tag:blogger.com,1999:blog-1721882659798727251.post-44623093161794473752011-07-03T01:29:00.000+05:302011-07-03T01:29:33.453+05:30Analysis of Compact Disc India Ltd<div dir="ltr" style="text-align: left;" trbidi="on">The uncertainty in the delisting of Compact Disc Ensues. Last month, HSBC Bank, bankers to the firm brought a stay order to the proposed voluntary delisting. This may mean several things, the first of which comes to my mind (i am speculating here) is the fact that the bankers may have lost faith in ability of the company to pay back and they feel that the money is being unnecessarily used to buy-back shares instead of doing something productive.<br />
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It is always tough for a company, if their banker, a reputed name in the industry shows such signs. This may hinder further raising of finances for the company. On a long run this may harm the growth of the company.<br />
<br />
Moreover the resignation of key personnel from the board sends the wrong message. As mentioned in my previous post, the target of 60 (based upon the past 26 week avg) had been passed. Now if the delisting does not come about, any appreciation of price may not come up.<br />
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Despite of the good figures in the book of the company i shall recommend not to go in for the shares of the company.</div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-70199315677317983502011-01-30T20:15:00.000+05:302011-01-30T20:15:31.705+05:30News on Compact Disc India Ltd<div dir="ltr" style="text-align: left;" trbidi="on"><u><b>Delisting</b></u> <br />
Compact Disc India Ltd has informed BSE that the Board of Directors of the Company at its meeting held on January 28, 2011, inter alia, approved and adopted the following:<br />
<br />
1. Board has <u>approved the delisting of its equity from the Stock Exchanges </u>where the securities of the company are listed. The Board convened an Extraordinary General Meeting on March 22, 2011 for approval from the esteemed shareholders. The reason for delisting shall be specified in the EGM notice.<br />
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I would like to remind the readers that for delisting, the company has to give a buy-back offer to the public as an exit opportunity as per a SEBI regulation. CDI has sufficient Reserves to accomplish this successfully. The minimum floor price of the offer is the 26-week average of the stock price, which in this case is around Rs58-59. </div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-34806543684357465982011-01-21T20:39:00.000+05:302011-01-21T20:39:39.140+05:30News on Compact Disc India Ltd<div dir="ltr" style="text-align: left;" trbidi="on"><span style="font-size: large;"><i><b>Board Meeting on Jan 28, 2011 | 20/01/11 18:02</b></i></span><br />
<br />
Compact Disc India Ltd has informed BSE that a meeting of the Board of Directors of the Company will be held on January 28, 2011, inter alia, to consider the following matters:<br />
<br />
1. To consider and approve unaudited financial results of the Company for the quarter ended December 31, 2010.<br />
<br />
2. To consider and approve the delisting of the securities of the Company from Bombay Stock Exchange and other stock exchanges where the securities of the company are listed.<br />
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3. To consider and convene the Extra Ordinary General Meeting of the members of the Company.<br />
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<br />
My Analysis:<br />
If the "Delisting of the shares is approved by the board on 28th, as per SEBI rules, they will have to give a Buy Back offer as an Exit opportunity for the shareholders.<br />
<br />
The price of the buy back offer is decided by the book building process, where the floor price is the past 26 week average. Now, for Compact Discs India Ltd, the 26 week average is around Rs 60. So hold on to shares till they reach 60.<br />
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Happy Investing!!</div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com1tag:blogger.com,1999:blog-1721882659798727251.post-31184679734397637432011-01-14T15:46:00.000+05:302011-01-14T15:46:30.244+05:30News on Lupin Ltd<span style="font-family: arial,helvetica,sans-serif; font-size: 10pt;"><span style="font-weight: bold;"></span></span><i><b>Lupin receives FDA Approval for </b><b><span style="font-family: arial,helvetica,sans-serif; font-size: 10pt;">Nabumetone tablets</span></b></i><i><b> | 14/01/11</b></i><br />
[Source: www.bseindia.com ]<br />
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<span style="font-family: arial,helvetica,sans-serif; font-size: 10pt;"><span style="font-weight: bold;">Lupin Limited </span>announced today that its U.S subsidiary, Lupin Pharmaceuticals, Inc. (LPI) has been granted final approval for its Nabumetone tablets, 500 mg and 750 mg strengths from the U.S. Food and Drug Administration.</span> <br />
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</div><div style="margin: 0px; text-align: justify;"><span style="font-family: arial,helvetica,sans-serif; font-size: 10pt;">Lupin’s Nabumetone is the AB-rated generic equivalent of GlaxoSmithKline’s RELAFEN tablets indicated for acute and chronic treatment of the signs and sympto of osteoarthritis and rheumatoid arthritis. Annual sales for the Nabumetone market in the US was $66.8 mn for the twelve months ended September 2010, based on I Health sales data.</span></div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-3720435207177107442011-01-12T18:31:00.000+05:302011-01-12T18:31:18.466+05:30November 2010 IIP Figures<div style="text-align: justify;">The Ministry Of Statistics and Program Implementation has released the IIP estimates for November 2010. The Press Note is as follows:</div><div style="text-align: justify;">------------------</div><div style="text-align: justify;">The Quick Estimates of Index of Industrial Production (IIP) with base 1993-94 for the month of November 2010 have been released by the Central Statistics Office of the Ministry of Statistics and Programme Implementation. The <b>General Index stands at 317.9, which is 2.7% higher </b>as compared to the level in the month of November 2009. The <b>cumulative growth for the period April- November, 2010-11 stands at 9.5% </b>over the corresponding period of the previous year.</div><div style="text-align: justify;"><br />
</div><div style="text-align: justify;">The Indices of Industrial Production for the <b>Mining, Manufacturing and Electricity </b>sectors for the month of November 2010 stand at 205.8, 343.9, and 230.5 respectively, with the corresponding growth rates of <b>6.0%, 2.3% and 4.6% </b>as compared to November 2009. The cumulative growth during April-November, 2010-11 over the corresponding period of 2009-10 in these three sectors have been 8.0%, 10.0% and 4.5% respectively, which moved the overall growth in the General Index to 9.5%.<br />
</div><div style="text-align: justify;">In terms of industries, <b>nine (9) out of the seventeen (17) industry groups (as per 2-digit NIC-1987) have shown positive growth </b>during the month of November 2010 as compared to the corresponding month of the previous year. </div><div style="text-align: justify;"><br />
</div><div style="text-align: justify;"><b>The industry group ‘Transport Equipment and Parts’ have shown the highest growth of 15.6%, followed by 12.6% in ‘Leather and Leather & Fur Products’ and 9.6% in ‘Other Manufacturing Industries’. </b></div><div style="text-align: justify;"><br />
</div><div style="text-align: justify;">On the other hand, the industry group <b>‘Wood and Wood Products; Furniture and Fixtures’ have shown a negative growth of 27.4% followed by 17.5% in ‘Jute and other vegetable fiber Textiles (except cotton)’.</b><br />
</div><div style="text-align: justify;"> As per Use-based classification, the Sectoral growth rates in November 2010 over November 2009 are <b>4.5% in Basic goods</b>, <b>12.6% in Capital goods </b>and <b>2.4% in Intermediate goods</b>. The Consumer durables and Consumer non-durables have recorded growth of 4.3% and (-) 6.0% respectively, with the overall growth in Consumer goods being (-) 3.1%.</div><div style="text-align: justify;"></div><div style="text-align: justify;"><br />
5. During the current month, low growth has been observed in Intermediate goods and Consumer non-durable goods. Important items registering highly negative growth include ‘Spun pipes’ [(-) 38.2%], ‘Railway/concrete sleeper’ [(-) 34.9%] and ‘Particle board’ [(-) 29.6%] in case of Intermediate goods and<br />
‘Rice bran oil’ [(-) 57.9%] and ‘Hair oil/ayurvedic hair oil’ [(-) 42.5%] in case of Consumer non-durable goods. Moreover ‘Agricultural implements’ [(-) 55.6%] and ‘Industrial machinery’ [(-) 46.7%] of Capital goods are also showing highly negative growth.</div><div style="text-align: justify;"><br />
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</div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-1605363169904146942011-01-07T13:47:00.000+05:302011-01-07T13:48:48.627+05:30News on Lanco Infratech Ltd<i><b>Lanco Infratech's successful Bid | 30/12/10</b></i><br />
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Lanco Infratech Ltd has informed BSE that:<br />
"Lanco Infratech Limited (LITL), has emerged as successful Bidder for 2 Laning with paved shoulders of Aligarh to Kanpur Section of NH-91 from KM 140.000 to KM 418.162 in the State of Uttar Pradesh on Design, Build, Finance, Operate and Transfer (DBFOT) on Toll Basis of National Highways Authority of India (NHAI).<br />
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The Scope of Work involves 2 Laning with paved shoulders of existing road, repair, widening and reconstruction of 3 major & 29 minor bridges, construction of 5 new Rail-over-Bridges, 4 toll plazas and other wayside amenities.<br />
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The Project involves an investment of around Rs. 1,000 Crores. The Grant from NHAI would be Rs. 287.91 Crores. The concession period for the Project is 12 Years including a Construction Period of 18 Months. The concessionaire will have the right to collect toll over the entire concession period starting from the Commercial Operations Date of the Project."The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-21514647828522186262011-01-07T13:39:00.001+05:302011-01-07T13:39:28.479+05:30News on Lupin Ltd<i><b>Lupin signs strategic agreement with FARMANGUINHOS, Brazil | 05/01/11</b></i><br />
[Source: www.bseindia.com ] <br />
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Lupin Ltd announced that it has entered into an agreement with Farmanguinhos, Brazil's largest PSU in health care for the supply of its 4 in 1 combination drug of Rifampicin, Isoniazide, Ethambutol and Pyrazinamide for tuberculosis. Lupin will supply the product for the next five years and also provide Farmanguinhos with the desired support for the set up of its local manufacturing in future.<br />
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With this agreement between Lupin and Farmanguinhos in place, Farmanguinhos has entered into a commitment to produce and supply the 4 in 1 combination drug to the Department of Health (Brazil), which will result in substantial savings for the government. <br />
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The 4 in 1 combination reduces the pill burden on the patient drastically, particularly as the treatment lasts for at least six months. As per WHO, the treatment abandonment rate has fallen from 8 per cent to only 5 per cent due to this reduced pill burden provided by the combination drug. WHO estimates indicate that globally there are 9.2 million new cases each year resulting in 1.7 million deaths.The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-67810705602936264592011-01-07T13:26:00.000+05:302011-01-07T13:26:50.586+05:30News on Parabolic Drugs Ltd<i><b>Completion of First Phase of Expansion Programme with the commissioning of MP-II Plant at Derabassi, Punjab | 05/01/11</b></i> [Source: www.bseindia.com]<br />
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Parabolic Drugs Ltd has informed BSE that the Company has successfully completed the first phase of its expansion programme initiated in 2008 with the commissioning of Multi-Purpose Plant II comprising of 5 manufacturing blocks for parallel production in Derabassi, Punjab. With the commissioning of MP II, the Company has added 325 TPA capacities at its Cephalosporin campus at Derabassi, resulting in a total production capacity of 773 TPA.The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-48797863747874412282011-01-04T17:10:00.000+05:302011-01-06T11:11:58.145+05:30Analysis of Lanco Infratech Ltd<b><i><span style="font-size: large;">Introduction</span></i></b><br />
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[From Company Website]<br />
Lanco Infratech has subsidiaries and divisions across a synergistic span of verticals. These include Construction, Power, EPC, Infrastructure, Property Development, and Renewables. Lanco Infratech’s projects, operational and underway, are spread across India. <br />
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A member of the UN Global Compact, Lanco Infratech is recognized for its Good Corporate Governance and Corporate Social Responsibility initiatives led by the Lanco Foundation.<br />
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[Analysed]<br />
<b>Lanco Power</b><br />
Lanco has 2092 MW of operational Power Plants. A further 7148 MW plants are under construction at various locations, out of which around 650 MW is of renewable energy including Hydro Power and Solar Power. They are also engaged in Power Trading.<br />
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The increasing Power requirement of a developing India augurs well for the company.<br />
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<b>Infrastructure/Construction Projects</b><br />
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<i>Lanco Hills </i>is one of the largest mixed property development projects in India located at Manikonda in Hyderabad, India. It is spread over <i>100 acres </i>and it is a Rs 5500 Crore project. It includes 15 Residential Towers, 11 towers of sez/non sez IT spaces, club house, multiplex, mall, 5 star and business class hotels, serviced apartments and more. The proposed signature tower with 121 floors would be the tallest residential tower in the world.<br />
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<b>Under Construction Order Book</b> <br />
<ul><li>Construction of New Terminal Building at Biju Patnaik Airport, Bhubaneswar.</li>
<li>1015 MW Imported Coal –based Power Project of<strong> Udipi Power Corporation Ltd</strong> at Udupi in Karnataka. </li>
<li>2 x 300 MW Coal-based Power Project of <strong>LANCO Amarkantak Power Ltd</strong> at Pathadi near Korba in Chhattisgarh. </li>
<li>2 x 35 MW Hydropower Projects of <strong>LANCO Green Power Pvt Ltd</strong> in Himachal Pradesh. </li>
<li>2 x 5 MW Hydropower Projects of <strong>Vamshi Industrial Power Ltd</strong>.</li>
<li>4 X 125 MW Teesta VI Hydro Electric Project of<strong> LANCO Energy Pvt Ltd in Sikkim</strong></li>
<li>2 X 600 MW Thermal Power Project of <strong>LANCO Anpara Power Ltd</strong> in Uttar Pradesh.</li>
<li>368 MW <strong>Kondapalli Gas Power</strong> Project</li>
<li>81 km Road connecting Bangalore –Hoskote–Mudbagal in Karnataka for NHAI. </li>
<li>82 km Road Connecting Neelamangla-Devihalli in Karnataka for NHAI.</li>
<li>Construction Order for <strong>Lanco Hills</strong>. </li>
<li>Construction of New Terminal Building at Varanasi Airport for Airports Authority of India.</li>
<li>Construction of Medical College at Srikakulam in Andhra Pradesh.</li>
<li>Construction of Medical College at Ongole in Andhra Pradesh.</li>
<li>Construction of Vedic University at Tirupati in Andhra Pradesh.</li>
<li>Construction of Medical College at Belgaum in Karnataka.</li>
<li>Lanco is executing the construction of New Terminal for Varanasi Airport for the Airports Authority of India. </li>
</ul><span style="font-size: large;"><i><b>Financial</b></i></span> <br />
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Sales for Sep '10 stood at Rs 1095 Cr and were higher than preceding quarter's of Rs 1075 Cr (Jun '10) but were considerably lower than that of Sep '09, which stood at Rs 1474.9 Cr. YoY net Profit decrreased from Rs127.38 Cr to Rs 45.79 Cr, which were lower than June '10 net profit of Rs 71.32 Cr.<br />
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Current annualised EPS stands at Rs 0.98 (Rs 0.49 for the half year ending Sep '10). Thus the current PE multiple stands at around 66 (For the price of Rs 65). The EPS has almost halved from the previous year, thereby doubling the PE multiple.<br />
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The Book Value per Share of the company stands at Rs 12.82 for FY10. Thus, the stock currently trades over 5 times the book value. Debt-Equity ratio is good for the company at 0.88.<br />
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Thus, although the financials don't look good for the company, following reasons are keeping the price as high as Rs 65:<br />
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<ul><li>An Extremely Strong Order Book</li>
<li> A Rs 4100 Cr EPC (Engineering, Procurement and Construction) contract from a Moser Baer Subsidiary</li>
<li>Host of Power Plant projects.</li>
</ul>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0tag:blogger.com,1999:blog-1721882659798727251.post-9024366268700229822010-12-29T18:39:00.000+05:302011-01-07T13:28:27.412+05:30Analysis of Parabolic Drugs Ltd<i><b><span style="font-size: large;">Introduction</span></b></i><br />
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[Based upon Company Website]<br />
Parabolic Drugs Limited is one of the fast growing API (Active Pharmaceutical Ingredients) and API intermediate manufacturing and marketing company in the SME segment, with increasing international presence and a strong R&D foundation, based at Chandigarh, India. <br />
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Commissioned in 1998, PDL has two fully functional, state of the art manufacturing units, a WHO-GMP certified Unit based in Derabassi (Punjab) and a world class Semi Synthetic Penicillin manufacturing plant at Panchkula, (Haryana) with one of its products been approved for sales to USA, respectively. With Presence in over 45 countries, Parabolic Drugs Ltd emerges as one of the fastest growing Pharma Company.<br />
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PDL has a dedicated Custom Synthesis and Research & development Centre at Barwala (Haryana), fully equipped with latest analytical facilities and backed up with cGMP pilot plant for scale up of technologies and filing of DMFs.<br />
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<b><i><span style="font-size: large;">Financial</span></i></b><br />
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PDL registered a modest growth of sales in Q2 FY11, as against that in the previous fiscal. Sales grew from Rs 128.84 Cr to Rs 147.45 Cr. On the other hand, the Net profit registered a tremendous growth from Rs 5.42 Cr to Rs 14.29 Cr. Operating profit margins have increased in this period. Equity capital has changed in the same period from Rs 10.75 Cr to Rs 61.89 Cr, thereby, direct comparison of EPS is not logical.<br />
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It should be noted that Q4 results of previous fiscal (FY10) showed a sales of Rs 167.76 Cr, which indicates a lower sales in the last quarter, but the positive indicator is, although sales have fallen, the profits have increased from Rs 11.52 Cr.<br />
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For the first half of this fiscal, sales stands at Rs 275.25 Cr as against Rs 233.42 Cr. The profits have also increased from Rs 13.15 Cr to Rs 24.82 Cr - a growth of 89%. The improving margins are a good indicator of the hopefully good performance by the company in the future.<br />
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EPS for the H1 of this fiscal stood at Rs 4.93, which take the annualised current EPS of the stock to Rs 9.86. The stock is currently trading at Rs 57, at a current PE multiple of 5.78, which is way below the industry average of 26.<br />
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The book value per share of the company stands at Rs 32.5. Thus, the stock trades at twice the book value, as against a higher Price per Book Value for peers ( Lupin - 8.23, Aurobindo Pharma - 3.89). <br />
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The long term debt equity ratio is 1.02, down from 1.21, which is good for a growing company. Total debt to equity has also fallen from 2.89 to 2.65. Current ratio has increased in the same period from 3.06 to 4.26. Cash flow to total debt ratio is at 10.52, which shows the financial stability of the company (Ability to pay debt through cash flows generated).<br />
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FIIs hold 16% in the company and the DIIs another 15%. The IPO of the company had listed at Rs 75 (lower band) in June this year. The company has a current market Capitalisation of Rs 350 Cr.<br />
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<b><i>Recommendation</i></b><br />
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We can Invest into the company keeping a long term view.The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com2tag:blogger.com,1999:blog-1721882659798727251.post-28669339405474714782010-12-27T14:57:00.000+05:302011-01-07T13:28:57.146+05:30Patience and Value InvestingIf value determination of a stock is the soul of Investing, then Patience is the heart, which will keep the "Investor" beating. Pateince can get you a multi bagger or convert that multi-bagger into a multi-loser. Warren Buffet has been quoted in the book "How to Pick Stocks Like Warren Buffett: Profiting from the Bargain Hunting Strategies of the World's Greatest Value Investor" by Timothy Vick, giving an example of the baseball player Ted Williams, having the seventh highest batting average of all time and the last man to average more than 0.4 in an entire season. Ted William says,<br />
<blockquote>“To be a good hitter, you’ve got to get a good ball to hit.”</blockquote>Along the same lines, to get a multi-bagger you should patiently wait for the right stock, at the correct value to make a buy and hope to make money out of it. Te patience part does not end at buying the right stock. The level at which you sell is also very important. Thus, if your stock is not doing well, you should still persist with it if you think you really have picked a value company, for in the coming time, the market will definitely recognize the worth of the company.<br />
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Sharing my own experience, I'll give you an example. I started investing at the most inopportune time for an Investor. I started when I had just joined Engineering College and after maintaining a Dummy Portfolio for an year (2006-07 to 2007-08). I had achieved a return of over 50% in the Dummy, and hence I decided to get into the real thing. The market (Bombay Stock Exchange) was at its peak of 21000. I purchased some shares of IndusInd Bank, that time trading at 122. They had fallen from a high of 135. In the last six months, they had traded between 100 and 135. Then Baer Stearns and Lehman Bros collapsed. The great fall started. Sensex fell from 21000 to 9000. IndusInd did the same from 122 to 40. I panicked. It seemed a bottomless pit and I was still in my infancy as far as the markets were concerned. I sold as soon as the stock reached 45. Today, the market has not crossed 21000, but IndusInd trades at 270.<br />
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This was selling while trying to stop your losses (only when the company is doing well fundamentally). But you may sell the stock prematurely as well. I had purchased Bank of Baroda at Rs 215. Within 4 months, It was up at Rs 300. With a gain of around 40% in four weeks, I felt it had increased a lot. I booked a profit. Now, the company at that level was still trading at PE multiple of around 5 to 6. Moreover, its profits were growing. The stock had not fully realized its potential. Today the stock trades at Rs 887 (After having touched Rs 1000).<br />
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Thus, Patience should be used, together with Value investing if you want to succeed.The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com1tag:blogger.com,1999:blog-1721882659798727251.post-56709893409293541852010-12-22T12:51:00.000+05:302011-01-07T13:29:15.837+05:30Analysis of Ind-Swift Ltd<div style="text-align: justify;"></div><div style="text-align: justify;"><b><i><span style="font-size: large;">Introduction</span></i></b></div><div style="text-align: justify;"><br />
</div><div style="text-align: justify;">Ind-Swift Ltd is the formulations division of the Ind-Swift group which was incorporated in the year 1986. The company, over and above the local formulations business is also engaged in CRAMS (Contract Research And Maufacturing Services), a very lucrative outsourcing business for pharma companies in India. It also indulges in R&D to supplement the CRAMS as well as its own aspirations.</div><div style="text-align: justify;"><br />
</div><div style="text-align: justify;"><b><i><span style="font-size: large;">Financials</span></i></b></div><div style="text-align: justify;"><br />
</div><div style="text-align: justify;">The Q2FY11 sales for the company stood at Rs 214.94 Cr against Rs 161.86 Cr in Q2FY10. Net profit is up from Rs 9.52 Cr to Rs 9.57 Cr, owing to pressure on profit margins. For H1FY11, the sales stood at Rs 393.34 Cr up from Rs 320.81 Cr for H1FY10. Net profit in the same period was up from Rs 18.17 Cr to Rs 20.58 Cr.</div><div style="text-align: justify;"><a name='more'></a><br />
</div><div style="text-align: justify;">The EPS for this half is Rs 5.26, bringing the current EPS to Rs 10.52 as against Rs 9.12 for the previous fiscal. The current PE multiple stands at 3.2, much lower than the Pharma sector average of around 26.1. If the company delivers a good performance in Q3, the share may touch a level of 46 from which it had fallen in the last month.</div><div style="text-align: justify;"><br />
</div><div style="text-align: justify;"><b><i><u>Other Positives </u></i></b></div><div style="text-align: justify;"><br />
</div><div style="text-align: justify;">Current ratio of the company stands at 2.96 up from 2.71. Cash flow to debt ratio is also at a respectable value of 9.25. The cash position of the company has increased to Rs 52.4 Cr at the end of FY10 from Rs22.96 Cr for the previous fiscal.</div><div style="text-align: justify;"><br />
</div><div style="text-align: justify;">In this fiscal, the Promoters have increased their stake in the company by 3%, which is also a sign of their confidence in the company.</div><div style="text-align: justify;"><br />
</div><div style="text-align: justify;"><b><u><i>Negatives</i></u></b></div><div style="text-align: justify;"><br />
</div><div style="text-align: justify;">The major negative is the increasing Debt of the company which has taken the total debt-equity ratio to 2.05. This in turn may mean large amount of investments for expansion.</div>The Millennial Indianhttp://www.blogger.com/profile/14253648141105560315noreply@blogger.com0