Sadhana has 4 different auditors for Statutory Audit, cost audit , Secretarial Audit and internal audit what do you make out of it ?
The other expenses continue to be on the higher side, the receivables are on the higher side too and they don’t even conduct investor calls - dicier than ever
Posts in category Value Pickr
Sadhana nitro :a Dog or a Horse? (17-05-2024)
Amoul Portfolio (17-05-2024)
Not sure about this. Tried googling but could not find anything on this.
Amoul Portfolio (17-05-2024)
Not sure about this. Tried googling but could not find anything on this.
Lt foods (daawat) (17-05-2024)
Pls don’t think I’m questioning your statement but just curious as to how you assessed L&T foods management and found them clean. I like them too but wanted to get your opinion.
NCC: Extremely undervalued (17-05-2024)
Both KEC and Kalapatru are way overvalued while NCC in my view is perfectly valued (may be a tad higher). Again short term stock price movement don’t always reflect the value of a business.
We are in yet another infra bull run and any company associated with infra development is getting rerated by the market. So one shouldn’t really read too much into valuations.
Wonderla Holidays (17-05-2024)
Attended the Call - I was looking for an answer for reduction in footfall in Kochi and Bangalore - The reason was reduction in group booking from Schools and Education institutions due to preponement of exams etc… Major footfall reduction is in Kochi followed by Bangalore.
IPO Review – Discussion until listing (17-05-2024)
Can anyone confirm getting allotment in good SME IPO issues ? Because I am convinced that some kind of scam is going on in the allotment process. Me, my family members and friends are participating in most IPO issues during last one year, with minimum application amount under retail category. Total applications are more than 200 during last one year, including good mainboard issues. But I am yet to get a single allotment. There is no transparency in allotment process. We are also in the dark if SEBI representatives supervise this.
So I am convinced that whole process is rigged. Want to take up with SEBI. Any suggestions?
Caplin Point Laboratories (17-05-2024)
CAPLIN POINT LABORATORIES LIMITED Concall Summary Date: 16 May 2024
FINANCIAL HIGHLIGHTS
During the quarter, the company delivered a strong performance augmented by their benchmark cash flows and their existing markets.
The overall growth in profits was on account of higher contribution margins by 3%, strong EBITDA, and increased other income.
Gross margins expanded by 320 bps YoY to 57.8% in Q4 FY24, aided by new product launches across existing and new markets
The expansion in gross margins during the year was 250 bps to 57.3%.
EBITDA increased by 20% on a YoY basis during Q4 FY24. In FY24, it was higher by 24% to ₹618.4 crore.
EBITDA Margin for Q4 FY24 increased on a YoY basis by 70 bps. For FY24, the EBITDA margin was 35.1%, up from 32.6% in FY23. This improvement is attributed to new product launches across existing and new markets.
The company had set aside an overall capex budget of around ₹600-₹650 crore for ongoing investment projects, most of which are nearing completion (~50%-55%). This capex is aimed at expanding existing production capacities, diversifying the product range, and achieving backward integration for a majority of the products. The CAPEX was financed mostly through internal accruals, and the company aspires to remain net cash positive throughout the process.
Since the last 4 years, the capex and opex stood at ₹800 crore and ₹1,000 crore respectively.
The receivable days stood at 114 days.
As of March 2024, inventories stood at ₹363 crore (including in-transit inventory). Further, cash reserves stood at ₹910.5 crore.
The free cash flow during FY24 was ₹172 crore, post capex outlay of ₹146 crore, while the same was ₹78 crore in FY23 post the capex of ₹194 crore.
Cash flow from operations in FY24 was ₹318 crore v/s ₹271 crore in FY23.
The company has liquid assets of ₹1,816 crore as of date, showcasing a very healthy balance sheet.
The total R&D (research and development) spend was ~16.4% of the PAT in FY24. As a % of revenue, it was 4.5%, similar YoY.
It declared a dividend of ₹2.5 per share.
BUSINESS HIGHLIGHTS
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The geographical breakup of sales as of the year was as follows: Latin America (LATAM) & Rest of the World (ROW) 82% and United States (US) 18%.
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The product mix in terms of consumption during FY24 was: 45% Outsourced and the remaining 55% in-house.
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The capacity utilisation during the year was ~90%-95%
EMERGING MARKETS
The LATAM business model continued to drive growth in both top and bottom lines, accompanied by improvements in cash flow cycles.
Revenue breakup across business segments in FY24 for LATAM was: wholesalers 55%, direct to retail 25% and institutional 20%.
The revenue mix in terms of business verticals in FY24 was: Generics 75% and Branded Generics 25%.
The company received approval from Colombia’s INVIMA (National Institute for Food and Drug Surveillance) for the Softgel line at the CP-1 site in Puducherry, providing access to key target markets of Mexico, Chile, and Colombia in this niche segment. They already have a notable presence in the Softgel segment in existing markets of Central America.
They have shortlisted 25 Softgel products to be filed in Mexico over the next 24 months, with all studies being done at Amaris Clinical, the in-house CRO (contract research organization) facility of the company.
It has 6 Injectable products approved in Mexico with a further 23 products under review. The company plans to file 50 products overall in the next 12 months, both from internal pipeline and outsourcing partners, a repeat of Caplin’s collaborative strategy in Central America.
They draw up plans to enter niche segments of Biosimilars and other Biologics such as Insulin, initially with a “Fill-Finish” concept, which would be manufactured in line with requirements from Regulated markets.
US & REGULATED MARKETS
They have delivered robust and consistent growth in the US, with revenue growing 51% over the last year.
Caplin Steriles (CSL) (one of their subsidiary) has experienced strong revenue growth, driven by the expanded capacity resulting from the addition of Line 5. The revenue generated from it crossed ~₹100 crore, during Q4 FY24 for the first time. Revenue for FY24 at ₹313.4 crore, up by 51%.
During the year, CSL’s EBITDA and PAT stood at ₹61.2 crore and ₹18.3 crore respectively.
CSL’s revenue composition demonstrated a balanced mix of product revenue supply & milestone plus profit share of 75% and 25% respectively for FY24.
CSL made progress with nearly 25 out of 50 state licenses available already. The company aims to launch its own labeled product in the US by Q2 FY25.
It received 3 ophthalmic product approvals from the FDA (Food and Drug Administration), with one product launched and the other 2 to be launched in Q2 FY25. The total number of approved ANDAs (abbreviated new drug applications) under Caplin’s name was 21.
The company has filed its first injectable suspension ANDA and its first Plastic Vial ANDA with the US FDA.
The company currently has 14 ANDAs under review, and it anticipates receiving approvals for 3-4 of these in the coming months.
The products currently under review include a combination of injectables, vials, ready-to-use bags, and ophthalmic products.
Line 6, (the robotic pre-filled syringes line), is currently in the qualification process and is anticipated to become operational within the next 3-4 months.
UPDATES
The company’s oncology division under Caplin One Labs goes commercial. They expect the entity to turn profitable within 6 quarters since multiple product registrations were already available in existing markets. The monthly opex stood at ~₹1-₹2 crore.
On the digitization journey, the company has taken on a project to automate all manual systems at the plant to fully automated systems, including e-logbooks and e-Batch Records over the next 12-18 months. Several functions at CSL are already completely digital, such as Quality Control, Microbiology, Documentation Management, and others.
Construction is set to begin soon on a new OSD (oral solid dosage) plant and oncology API (active pharmaceutical ingredient) facility near Chennai. The facility aims to be commissioned by the end of Q1 FY26, to triple the existing OSD capacity. This expansion is intended to meet the growing demand from larger Latin American markets like Mexico and Brazil, along with regulated markets such as the US and EU (European Union).
FUTURE OUTLOOK
The growth in FY25 would be in a similar trajectory for both revenue and margins. However, they are confident of growing consistently on account of market growth, new product launches, and capacity building.
The company has filed several products in non-US markets such as Canada, Australia, Mexico, South Africa, China, etc., and some approvals and launches are expected within FY25 for these.
They will launch 11 new products in the US in FY25, in several niche segments of Injectables, including Ready-To-Use Bags, PP Vials, Injectable Suspensions, and Ophthalmic Solutions.
The focus would continue on cash flows, bottom as well as top-line growth along with focused investment into technology in products, facilities, and markets.
The remaining state licenses would be received in FY25.
The cash balances have continued to increase and the management plans to maintain this for future acquisitions focused on forward integration, if any.
The company believes US business to be one of its primary markets that will drive growth in FY25 and FY26.
In 2 years, the Mexico market would contribute significantly to growth as well as profitability.
By FY28, the aspiration remains intact to expand its presence in all regulated markets.
Great Eastern Shipping (GE Shipping) – Possible Sleeper? (17-05-2024)
other income is treasury (interest income) due to large cash in reserves. Company rerating may depend on ongoing upcycle in shipping industry, however downturn is unlikely.
The old PE’s should not be considered as these shipping companies for first time is going to become debt free after many years just because upcycle has lasted bit longer this time… So their avg operating cost will be less than previous years…