Hi @praveen_potnuru
I started my investment journey in 2022 and I don’t do trading. I’m still learning basic stuff. I use campus shoes and the quality is good. All peers are trading nearly at the same valuation and Campus was trading at 52 weeks low. I thought 70 PE was normal for this industry. This PE might be normal only for earning growing stock but Campus is not growing clearly.

My average price was ~300. I thought that this quarter would be a good one, almost all other footwear company’s quarter is really good if compared to Campus. The moment I came to know about the red flags (COO resignation and Insider Trading), I was already down by 6-7%. I regret not selling at that point. In short, it was a mistake and learning for me.

I still believe in the company but something is not right at the moment in the company as numbers don’t lie. There is a high possibility that the next quarters won’t be good enough and we might see a lot of further correction in this stock so I simply exited with ~20% loss to save remaining capital

Margin revival continues for Eris. As they turnaround acquisitions, their appetite for newer acquistions keep increasing, with them now acquiring nephrology and dermatology brands from Biocon at 3.7x EV/sales. They are confident of increasing margins of acquired portfolio from 20% to 30% in a years’ time. Concall notes below.

FY24Q2

• FY24 guidance: 2000-2100 cr. sales, 700-710 cr. EBITDA (30% growth), 410-415 cr. PAT (without Biocon acquisition)
• Capital allocation strategy: focus on using operating cashflows to expand into newer therapies through acquisitions (Strides gave them Nephrology, Oaknet gave them Dermatology, Biocon adds to Nephrology and Dermatology)
• Acquired 12 brands in Nephrology (Organ transplant focused power brands like Tacrograf and Renodapt; 65 cr. sales; 40 MRs) and 9 brands in Medical dermatology (Psoriasis and Atopic Dermatitis; 35 cr. sales; 50 MRs; Psorid is 25 cr. brand) from Biocon for 366 cr. (including working capital; 3.7x sales; 280 cr. will be from debt). Total personnel: 90 MRs + 30 others. Very high MR productivity (9 lakhs YPM). Will reach 30% EBITDA margin in FY25 from 20-22% currently
• Amortization will be 17-18 cr. annual amortization (20 year window)
• Psoriasis market is 1100 cr. (2-year growth of 20%). This acquisition makes them second largest in psoriasis with 11% market share
• Nephrology market is 3000 cr. growing at 11%
• When there is personnel acquisition (and not only brand acquisition), then leakage of sales is lower
• In Glenmark acquisition, have reached 100% of sales but for Dr Reddy have only managed to get to 90-92% by Q2
• Organic growth: 7-8% (vs covered market growth of 2.5% in H1)
• Launches
  o 2 FDCs in oral diabetes approved (Gliclazide-Dapagliflozin, Gliclazide-Sitagliptin) and will be launched this quarter. Both are first to market
  o Launched 2 “at-risk” products (Linares & FCM) in Q2
  o Launched 4 products in dermatology in Q2 (Hydroheal, Nova, Efatop Hydra, Crisanew)
  o Pipeline increased to 14 from 10 in Q1: Added 2 FDCs in gynecology, 1 first time to Indian launch in cardiovascular and 1 in respiratory therapy in FY25
• Their 50 cr.+ brands reduced from 15 in Q1 to 13 in Q2. 100 cr.+ brands increased from 4 in Q1 to 5 in Q2
• Will start commercial production in dermatology in Q4FY24
• Insulin: 10 cr. sales in Q2FY24; (-1.8 cr.) EBITDA loss
• Market coverage: 83% in diabetes, 54% in cardiovascular, 50% in dermatology

Disclosure: Invested (position size here, no transactions in last-30 days)

1.Like Radico Khaitan, they are also trying for Prestige and above segment but have not yet created their own market. In the Value segment market, pressure on margin still exists.
2.Management seems to be comfortable with revenue from sub-contracting work for Diageo , Bacardi and bulk Alco.
3. Ready to drink segment: very early-stage funding and small market as compared to Alco market.

Greeting to all,

I just have one question

In a company where Promoter sold their 24%stake and it got bought by DII ( increased from 16% to 33% name:- Quant, Icici, Bnp paribas, goldman, mirae etc) and & FII ( increased from 3% to 10%)

How to look this transaction?

Thanks