Shilpa Medicare – Update

YTD graph of Shilpa MedicureWe recommended SML in our blog on 26th July, 2009 @ 90. The stock has witnessed a fantastic upmove and has been hitting upper circuits since last few days. The stock was locked up at 161.70 today J

At CMP, we advice small/partial profit booking but at the same time one shouldn’t underestimate the long term story in this stock. The stock still has long term potential for the following reasons:

  1. The company is all set to emerge as the biggest & dedicated player in the Oncology segment.
  2. The company has fantastic operating margins of 25-30% and the company is growing @ 30%+.
  3. For co’s growing at such pace with such high margins, the PE multiples could be in the range of 15-20.
  4. If so, price target of Rs 200 can be achievedJ.

Other triggers are:

  1. The company is expected to receive USFDA approval by the end of this year.

Apart from that, we are awaiting the annual report of the company and looking for industry/market updates. Chip in your updates, if any.

Jaihind Projects

“First I determine themes that will be played out over the next several years. Then I identify groups of stocks that reflect those themes.” – Ralph Wanger

Working on the above advice, we all will agree that the next big opportunity is in the Gas Sector. Early beneficiaries will surely be “pipe line laying” companies.

Jaihind Projects (JPL) is a leading player in this space and is scaling up very aggressively. I have been bullish on JPL for quite some time and feel that there is enough potential.

About Jaihind Projects (http://www.jpl.in/)

  • It is only listed dedicated player available in this space.
  • Company has been doing this work for major PSUs such as Gail, IOC, GSPL etc for several years. Gail, GSPL etc have ambitious targets for building pipeline network across India, JPL should surely gets its share in future orders.
  • The company has grown from just 50 Cr turnover in 2005 to 325 Cr turnover last year.

Going Ahead:

  • Company is expected to achieve a turnover of atleast 500 Cr+ this year and if they are able to maintain their historical operating margins at around 12%, the company has potential to achieve Net Profit of atleast 20-25 Cr.
  • Which will result into an EPS of say 20-25 on an expanded equity of close to 10 Cr.
  • At current market price of less than 100, the forward P/E is less than 5. Considering the things will go well, stock has potential to more than double in two years period.

Risks:

  • The company has been taking debt to expand so if there are delays, the company can be adversely affected.
  • The company has been diluting equity by issuing shares to promoters on preferential basis.
  • The company doesn’t pays dividend to conserve cash for growth.

Do work out the calculations and share the views.

Shilpa Medicare – A strong bet on Oncology

The company has come out with very good June Qtr nos and deserves a closer tracking.

About the company and the business:

  • Company has been expanding in the Oncology space and wants to be the largest Oncology API manufacturer in India apart from big formulation cos which do production for captive use. This space has lesser competition and hence quite high margins
  • Go through the announcements of the regulatory approvals the company has achieved in last 1 year. Co claims to be one of the few cos to get such approvals
  • Company expects to get USFDA approval by year end.

On Financials:

  • Company has scaled up from just 25 Cr topline in 2003 to 138 Cr last year and targeting close to 200 Cr this year.
  • Margins have been on the rise over the years due to co’s deliberate move from low margin to high margin business. The margins are currently at 25%+…on a turnover of 200 Cr this will result into an operating profit of 50 Cr, from this we should subtract the interest and taxation cost, which shouldn’t be more than 7.5 & 10 Cr respectively. We get a figure of 35 Cr+ as potential cash flow this year and NP could be close to 25 Cr, conservatively.
  • For margins calculations I have been removing the forex adjustments. Last year the company suffered a notional 10.85 Cr forex loss on the outstanding ECB. In this quarter there is a gain of 2.9 Cr.
  • There are some losses in the consolidated nos, as the company did an acquisition in Austria last year. These losses are expected to come down soon.

Why I like the company:

  • I like companies with scalable business model having high operating margins. Shilpa is growing fast with operating margins expected to remain very healthy around 25%.
  • The company seems honest and has been applying conservative accounting policies. The company has been providing good amount of depreciation and tax at the maximum rate.

Valuations:

  • Currently trading at less than 8 times expected FY 10 EPS of 12 (this EPS is excluding forex gains/losses). Not very cheap but a strong buy on declines.

Annexure 1:

Year

200303

200403

200503

200603

200703

200803

200903

201003

Type

Full Year

Full Year

Full Year

Full Year

Full Year

Full Year

Full Year

Full Year

Sales Turnover

24.11

35.66

37.51

47.62

68.39

95.81

138.09

200.00

Other Income

1.78

0.73

1.12

1.27

2.36

2.52

0.90

Total Income

25.89

36.39

38.63

48.89

70.75

98.33

138.99

200.00

Total Expenditure

23.68

30.88

32.79

40.58

56.79

77.22

102.00

Operating Profit

2.21

5.51

5.84

8.31

13.96

21.11

36.99

50.00

Interest

0.29

0.46

0.31

0.39

0.32

0.85

4.92

7.00

Gross Profit

1.92

5.05

5.53

7.92

13.64

20.26

32.07

43.50

Depreciation

0.30

0.82

1.00

1.77

2.30

3.51

6.05

9.00

Extraordinary Adj

0.00

0.00

0.00

0.00

0.00

0.00

10.85

0.00

Tax

0.63

1.74

1.24

1.88

3.48

5.44

8.39

9.00

Reported PAT

0.99

2.49

3.29

4.27

7.86

11.31

6.78

25.00

EPS

0.74

1.85

2.40

2.46

4.53

5.32

3.08

11.35

PE

12.00

Exp Price

136

CMP (26-Jul-09)

95

OPM %

9.17

15.45

15.57

17.45

20.41

22.03

26.79

25.00

NP %

4.11

6.98

8.77

8.97

11.49

11.80

4.91

12.50

Mcap

209.24

ROCE:

21.73

39.54

29.53

17.61

21.34

12.21

Free Stock Screeners for Indian Stocks

UPDATES:

At Dalal-Street we have now developed an in-house stock screener at: http://www.screener.in

Screener.in is a powerful and exhaustive stock screener providing complete flexibility to sort, arrange and customize the search results. Screener also provides advanced options to save stock screens and also set automatic email alerts for them.

———-

Stock Screeners are tools to help us find the stocks based on performance. Though we recently said that we were yet to have a good professional stock screener, we were able to find many. In fact, we were unaware that even BSE had its own little stock screener. Here we compare and review the free stock screeners for Indian stocks.

5) BSE India – Stock Scanner

bsescreener

BSE India provides a small screener to find stocks based on the group, P/E ratio, EPS, LTP and Market Cap. The results are most up-to-date and accurate, however the options are limited.

Continue reading Free Stock Screeners for Indian Stocks

Google Finance – The best stock summarizer

Update: We have now built our own stock portal too – http://www.screener.in

There are many sites which provide the stock summary of India stocks on one page including Money Control, Rediff Money Wiz, Sify Finance, Yahoo! Finance etc. However, Google Finance is what we liked the most, and potentially the best stock screener in making. For financials, economic times remains the best.

Do checkout our custom built stock screener and analytic web-app too: http://www.screener.in

Compare:

 

This is one feature that separates Google Finance from all others. The price charts are very quick providing data for even 10 years (or more). These can be used to compare the prices of your favourite stocks with other stocks or even with the various Sensex. The carts also show the Dividends, splits, bonuses and other announcements in the timeline.

Continue reading Google Finance – The best stock summarizer

Awesome BSEXL – One Excel sheet for everything

“I fear not the man who has practiced 10,000 kicks once, but I fear the man who has practiced one kick 10,000 times.” – Bruce Lee

awesome bse

Excel is one tool which we all have used more times than the calculators itself. Then why not get all the data of the companies on an excel sheet ? Awesome BSEXL is an attempt towards that.

Awesome BSEXL is not any hard-to-understand software, but just an excel workbook with the data of currently 1500 BSE listed companies on one sheet. It is like the regular columns found in the newspapers or the Capital Market magazine. However, we have tried to include many other details into it, including following:

  • Script Code and Script Name
  • Last Trade Price
  • Book Value
  • P/E ratio
  • Discount (Book Value – LTP)
  • Sales of last four quarters
  • Profits of last four quarters
  • Sales of past three years
  • Profits of past three years

Using excel filters and advanced filters, you can create queries as you like and make the reverse processing possible (search companies which perform as YOU want them to perform).

We have included the basic advanced filter by default (you can learn more about it at Microsoft site). Thus your capabilities are unlimited.

The data currently in the sheet is only for past 3 years (however you can get data about the companies for more than 10 years here manually). Your comments are more than welcome for future developments.

Download Awesome BSEXL (966kb)

10 (or even more) Years financial data of Indian companies

If past history was all there was to the game, the richest people would be librarians. – Warren Buffett

BSE India and other sites including Money Control, all provide the financial data of maximum 5 years. So what to do if you want the data of more than 5 years ? Economic Times provides the solution.

2009-05-09_144256

Economic Times uses multiple databases and provides the financial data even for more than ten years. The comparative data however only for the P&L Account and Balance Sheet. Same feature is not available for Quarterly results.

Also, I wish if they had a feature to export this data into excel automatically. Apart from this, the service is quite useful, flexible and easy.

Do share other sites (if any) that provide the long historical financial data for free in comments.

Visit Economic Times Company Search