(post deleted by author)

Seems like they are trying to caution the investors (who have high expectations after peer companies results) to keep the rational expectations that is just after recent surge in stock prices also, one more thing I feel like is there are lot more headwinds and for a prolonged period than one is expecting at this moment, this might be the reason why Pabrai has sold his stakes.

Disc: recently added between 150-160 levels

@ap1990
MPS Q3 numbers were clearly disappointing, more so as the mgt. had needlessly upped the guidance just a qtr ago. The numbers themselves were not that bad, with operating margins getting better despite the set back in the e-learning business. I guess the mgt too has learned its lessons & will hopefully, going forward, let their numbers do the talking! I guess the the pressure of having concalls after every quarterly numbers also gets to the mgt whose enthusiasm to please shareholders can sometimes get the better of their judgement! The mgt. though has stayed committed to their vision 2027 of 1500 crs, & hope to actually achieve it before time with similar margins.

I am of the view that the mgt. is well meaning & have by & large walked the talk over the last 7-8 qtrs, which is a sufficiently long time. I also believe the the mgt. has the wherewithal & ability to grow inorganically by successfully acquiring companies & then integrating them. That is what will create shareholder value in the long run. It matters less that the vision 2027 is realised 2-3 quarters behind schedule but the journey forward should clearly show a pattern in that direction.

The Co. is generating free cash flows of about 130-150 crs annually. Has given a interim dividend of Rs. 30/-, & could easily give another similar final dividend (I think the mgt has mentioned something to this effect in the previous concall, admittedly to be taken with a pinch of salt!) That would make the stock give about a 4% dividend yield.

I feel any meaningful correction from current levels of about 1490 could present a decent buying opportunity & I will look to add.

Disc: Invested

Putting everything on the side:
Just for random calculations

I did the current valuation of the PF on the first day and what would happen if it is left untouched.

There might be some errors but it is majorly correct.

Days 2916.

Not here to prove any thesis.
Since this thread was inactive for long, just did a calculation.

Cipla Q3 FY 24 –

Concall highlights –

Sales @ 6604 cr, up 14 pc
EBITDA @ 1748, up 24 pc (margins @ 26 vs 24 pc)
PAT @ 1068 vs 808 cr
R&D spends @ 6.1 pc of sales, up 10 pc YoY

Region wise performance –

India sales @ 2859 cr, up 12 pc, fuelled by chronic therapies and big brands ( 44 pc of total sales )

North America sales @ $ 230 million, up 18 pc ( 29 pc of total sales )

South Africa sales @ ZAR 1355 million, up 15 pc
( 1 ZAR = Rs 4.4 )

Other international Mkt sales @ $ 90 million ( 11 pc of total sales )

API and others represent 4 pc of sales

Company’s cash holdings @ 7200 cr ( I hope they r used to acquire speciality, branded portfolios )

Forecort Inhaler – became the No 1 Indian brand in Q3

Filed gSymbicort and one more product in US mkts

Awaiting approval for one peptide product launch

Therapy wise rank of Cipla India –

Respiratory – 01
Urology – 02
Cardiac – 07

Overall rank in India – 03
Rank in chronic therapies – 02

Company has 10 brands in top 100, 06 brands in top 50 and 03 brands in top 25 in IPM. Company has 20 brands with sales > 100 cr/yr

Cipla’s popular Indian OTC brands – Omnigel, Nicotex, Cofsils, Cipladine, Prolyte ORS solution

Acquired Actor Pharma in RSA for $ 49 million in Q3. Integration process is on

Q4 is a seasonally weak Qtr – both in India, US

Company’s Goa plant is scheduled for a re-inspection by USFDA in Q1 FY 24. It was last inspected in Aug 22 and was given a warning letter. Similar is the case with their Pithampur plant which was also given OAI status in Feb 23. OAIs at these 2 plants are hampering the new product launches in US

One Peptide product should get launched by Q1 FY 25. Cipla should be the first company to launch it. Mkt size for the product is descent ( they did not quantify )

Company is hopeful for an approval for the launch of Advair in US by end of FY 25. Current price of the generic Inhaler is around $ 30 / inhaler

Cipla has about 20 pc mkt share for lanreotide 505(b)(2) product in US. Hope to keep gaining incremental Mkt share in the coming Qtrs

Going fwd ( 3-5 yrs ), Respiratory and Peptide assets shall continue to be company’s two largest segments in the US mkt

Cash on books to be used for bolt-on acquisitions. Can go for larger assets in India, relatively smaller assets in Intl Mkts

Disc : holding, biased, not SEBI registered