Thanks Hitesh for a lucid explanation of the impact of the latest approval.
The market seems to be considering abilify as an one time earning. Now another big approval in their fold the earnings should grow more homogeneous way.
Only thing left now is their own front end team in US, which they are already building. So their margins will improve going forward. This will ensure that the lumpiness in earnings due to the nature of generic business will reduce to certain extent.
Posts tagged Value Pickr
Alembic & Alembic Pharma (26-08-2015)
Nitin Spinner – textile yarn story (26-08-2015)
Went through AR 15 -my big worry was that OCF has plummeted from Rs 86 Cr in FY 14 to Rs. 40 Cr. odd in FY 15 primarily on the back of increasing debtors, inventory. On top of it, there is a Rs. 196 Cr. loan taken to build out capacity.
Normally a company that takes such a huge loan ought to be more prudent on debtor management and not let cash flows slip - I hope it was a "Snapshot" issue and will wait to see BS in sept.
When I look at cash flows to debt ratio, it looks quite worrisome - I can only hope it's a temporary issue and the mgmt is cognizant of the same.
Yet another thing I observed was how soon the law of diminishing returns catches up in a commodity business - more and more capital goes in and lesser and lesser profit comes out.
I am invested in it as a cigar butt and watching it closely.
Ambika Cotton Mills (26-08-2015)
Calculating FCF for textile business is merely optical illusion.
This industry requires huge capex and you never know a single capex can eat up 3 years of FCF.
Waterbase – Can it be Next Avanti Feeds? (26-08-2015)
Waterbase Limited announces merger ratio for merger of Pinnae Foods Limited
- No cash outflow for the merger
- 4 shares of Waterbase Limited will be given for 17 shares of Pinnae Feeds Limited
- Pinnae Feeds Limited has an installed capacity of 75000 MTPA at Nellore
- Capacity of Waterbase Limited will triple from 35000 MTPA to 110000 MTPA
- Expected completion of merger by Q1FY17
- KPMG is the advisor for the transaction
The paid-up capital of Pinnae Feeds Limited is Rs. 10 crores and with this merger ratio, the equity capital of Waterbase Limited will increase by 2352941 shares or Rs. 2.35 crores... Debt as per CARE rating is Rs. 77.20 crores... These are my assumptions as per data available on internet...
Negative:
- Debt will increase, but Waterbase has almost 30 crores cash... So, shouldn't be high I feel...
Note: Have vested interest... So, take my assumptions with a pinch of salt...
Ambika Cotton Mills (26-08-2015)
1..I have carried forward Amit's assumption of 44 million
Nt sure how he arrived @ 44 million
But my excel giving different values
2..FCF growth rate for first 5 years = 13.7 % ( taking FCF growth rate for last 10 years and dividing by 2) ???
I am also not able to get How Amit get it?
@ amitverma21
Ambika Cotton Mills (26-08-2015)
@vinamrachaware - good effort.
Couple of questions:
1. How did you arrive at the FCF figure of 44 million?
2. Assuming the initial cashflow as 44 million, what is the logic behind growing it by 13.7%?
I am raising this question because textile industry by nature is very high capex intensive i.e. in simple terms it needs frequent upgradation of technology, machinery etc to compete with other players
If you see the historical FCF generation of Ambika, I think it has generated positive cash flow in only 4 out of last 9 years which includes major capex in 2007, 2008, 2011 and 2014. If you apply negative FCF every alternate year based on historical trend, I guess the fair value will go below CMP.
Indocount notes from AR (26-08-2015)
- 70% export from US. Most of the export market is developed country and hence get INR depreciation advantage for this year.
- Some one can expect 30% EPS growth expected in FY16.
- Debt can be 0 in FY18 basis if they grow only 15-20% on current earnings.
- Huge potential at current level at 19 p/e with long term prospect of 3-4 years. Very rare combination we can get for such company.
NGL Fine Chem-Re Rating Possible? (26-08-2015)
ICRA Upgrade the NGL rating from A3 to A3+
ICRA ratings for Indian debt instruments-Aug 26
NGL Fine-Chem Ltd ST: Non-FB A3+ 35.5 Upgraded from A3
