Though we have tried to cover all companies yet on Sales and Potential in the Healthcare segment, we are really short-staffed to push out first in class updates on the same. Suffice it to say that with Orchid Chem FCCB redemption coming up, bonds will be called and the fear has driven the scrip down from 186 levels.
Current TV18 interviews with promoter K Raghavendra Rao confirming that fears are misplaced as a further ECB has been tied up to return the earlier FCCB debt as also domestic arrangements have been made. The company also ‘guides’ lower interest costs in 2012
The company is profitable with a 10% NPM and good Q_O_Q and yearly growth in the September quarter, running to $500mln + run rate. Definitely not worth dropping and something you should buy and keep with Glenmark, Opto circuit (devices) and hold Biocon if you have any
If you do the calculations, from the USD 500 million of our sales, around USD 420-430 million is exports, and against that the import component, it is less than USD 200 million.
The delta of USD 200 million on profit and loss statement (P&L) is in terms of dollar inflow and my dollar outflow including FCCBs is less than USD 200 million. My dollar balance sheet is mildly positive hence rupee volatility is just a paper entry and it doesn�t affect Orchid on six months or one year basis.
Lupin and Cipla are the bigger ones in the area who were actively looking to sell out ahead of changing FDI regulation in the sector where earlier M&A has already scooped out much local infrastructure and biggie Sun Pharma is adding inorganic marketing and research strengths. Dr Reddy is a stable business with sales intact a a $2 bln run rate
In most cases the domestic market is relatively small, but that is more of a limitation for MNC pharma stocks still listed
- India Earnings Season: IDFC, Pharma, moody’s rating (awardz.wordpress.com)
- Biocon chief vows near-term pact on oral insulin (fiercebiotech.com)
- India Earnings Season: BIOCON, September 2011 (awardz.wordpress.com)
- Rupee Impact: ECB & FCCB, repayment due 2012/3 (awardz.wordpress.com)
- MNCs lobbying against capping of FDI on 49% in pharma ventures (donttradeourlivesaway.wordpress.com)