My calculation for 4 Rs cost is based on the discussion with the management and extrapolation of past results. Lets to look at the following Table:
As we can see from the above table, gross margin of the company is increasing. This is mainly on account of higher margin in Female segment. As per the management, gross margin in the female and male segment is 80-90% and 30-40% respectively. Lets see the following table to understand it better.
* Rough calculations
So it is clear from the above table that gross margin is around 85% in the FC. Selling price of Cupid FC is around 24-25 Rs so cost of manufacturing comes to be around 4 Rs.Cost and selling price of FHC is 15 Rs and 35 Rs respectively.
Moat:
- Based on the above facts, i think company has cost advantage. Further, operating cost for cupid is very low as compared to FHC.
- Secondly, as it takes long time to get approval and market size is too small for the big players to concentrate on right now. There is high entry barrier in the industry.
Disc: Invested and views could be baised.
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