@kjshah18 : Yes you are correct. I was wrong.

I forgot that whenever a bank/NBFC raises equity capital, it's NIM increases for short period of time. Though over the period where no equity capital is raised, NIM depends purely on cost of funds and yield. So markets usually do not consider temporary ups in NIM after capital raising. NIM trend through normal operations matters a lot though.

It is commonly believed that the best forensic guys are the short sellers. You may know that Bill Ackman, the legendary hedge fund manager short sold Herbalife with a $ 1 billion position in 2012. It has not yet worked for him, even as he spends $ 100 million annually just to maintain his shorts.

Bill made a 2.5 hr, 524 slide presentation in 2012 and kept a dedicated website - http://www.factsaboutherbalife.com/

Fortune has a very instructive essay / article Bill's attempted siege of Herbalife and Herbalife's counter-attack. It is long but written in an engaging manner. It can be found here - BIll Ackman vs Herbalife. Unlike Bill's earlier shorts, this one seems to be a longer battle; and with many fund managers taking a long position.

Hi Jigar - As per the recent order to the company for female condoms, the price worked out to be 18.5 INR as per calculation by a forum member and for retail the price is around 50 INR per piece as per online retailers websites. I assumed the price to be nearer to institutional sales as this is where the revenue would be coming from majority of it.

As for male condoms, the online prices are anywhere between 5 INR per piece to 15 INR as per amazon.in etc, I have assumed conservatively at 5 INR.

What are your observations?

As per the company the current capacity is 40 crore male condoms and 1.5 crore female condoms which could be equivalent to revenue of approximately,

(all in crores - price assumption as below)
(40 crore pieces *5 INR per piece) + (1.5 crore pieces *20 INR per piece) = 230 crore. FY15 Revenue 45 crore and FY 16E revenue 60 crore. Which means the company needs no capex until it becomes 3 times the current size?

1. Did not assume that a portion of male condom facility will be converted to female, in which case the revenue at 100% utilisation will be more than the above estimates.

2. Assumed a male condom price realisation to be 5 INR per piece and female condom to be 20 INR per piece.

Please suggest if there are any loopholes in the above calculation? There seems to be vast underutilisation of capacity as we speak. So company can take large orders without sweating if my above calculation is somewhere near to reality. @RajeevJ ji would be in a better position to offer some insights here.