Financial Results & Results Press Release for March 31, 2014
Link: Click Here
Board recommends Dividend:
Ajanta Pharma Ltd has informed BSE that the Board of Directors of the Company at its meeting held on May 05, 2014, inter alia, have recommended dividend @ Rs. 10/- per equity share on the face value of Rs. 5/- each, subject to approval of shareholders at the ensuing Annual General Meeting to be held in 2014.
Independent Press Release PDF
Link: Click Here
New Investor Presentation
Link: Click Here
Used few good words to describe the performance of the company some 21 months ago, when I started putting my views on this blog. Then had to use more such words, as the performance continued to impress every quarter. I thought at some point of time, after few such quarters, the numbers will stabilize, and then, finally, I will have to rest my words on praising the company.
But it seems a never ending process....
Sorry no new words left this time.. :)
Coming straight to numbers,
For Q4 FY'14,
Revenues stood at 311 Cr vs 249 Cr yoy, growth of 25%.
Net Profit stood at 70 Cr vs 29 Cr yoy, growth of 159%.
EPS stood at 19.94 vs 7.71 yoy.
For the full year FY'14 vs FY'13,
Revenues stood at 1110 Cr vs 839 Cr, growth of 32%.
Net Profit stood at 221 Cr vs 101 Cr, growth of 118%.
EPS stood at 62.83 vs 28.78.
The consolidated numbers are having similar ratios, so not much to mention over there.
Consolidated EPS for the full year FY'14, stood at 66.54.
My Views:
Lots of positives to be taken from the Press Release as well as New Investor Presentation. The company has filed one more ANDA with US FDA, which takes the total tally of ANDA pending for approval to 21. The management expects 2-3 ANDA approval in FY15. 24 new products were launched in FY14, out of which 5 were in Q4. R&D expense stood at 50 Cr vs 37 Cr last year, which is highly encouraging.
The biggest positive is the growth in India sales. In Q4, company showed 33% growth in India sales, and for the full year, it stood at 32%. Such growth in India & other emerging markets will reduce the dependency of profit on dollar rupee fluctuations.
The only issue is with the update on their upcoming facilities in Gujarat. According to previous presentation, it was expected to be commercialized in Q1 FY'15, whereas in the latest presentation, it is being shown as Q1 FY'16. We will have to get clarity on that from the management.
Coming to stock price, I don't think, Rs fluctuation will make that big a difference going ahead, as their sales in emerging markets is growing very strong, especially in India. At CMP, the stock is trading at a P/E multiple of 16, which is fair. But the company should continue the growth in bottom line going ahead. Hence stock price appreciation should continue in my opinion, but can't guarantee the pace of moving ahead, as it has appreciated tremendously in past 2 years.
Recommending a hold for current investors, and those with good patience can look for new entry at current levels also, using every dips to buy more. Upgrading the target price to 1500 now, keeping long term view in mind.
All the best!!!
Link: Click Here
Board recommends Dividend:
Ajanta Pharma Ltd has informed BSE that the Board of Directors of the Company at its meeting held on May 05, 2014, inter alia, have recommended dividend @ Rs. 10/- per equity share on the face value of Rs. 5/- each, subject to approval of shareholders at the ensuing Annual General Meeting to be held in 2014.
Independent Press Release PDF
Link: Click Here
New Investor Presentation
Link: Click Here
Used few good words to describe the performance of the company some 21 months ago, when I started putting my views on this blog. Then had to use more such words, as the performance continued to impress every quarter. I thought at some point of time, after few such quarters, the numbers will stabilize, and then, finally, I will have to rest my words on praising the company.
But it seems a never ending process....
Sorry no new words left this time.. :)
Coming straight to numbers,
For Q4 FY'14,
Revenues stood at 311 Cr vs 249 Cr yoy, growth of 25%.
Net Profit stood at 70 Cr vs 29 Cr yoy, growth of 159%.
EPS stood at 19.94 vs 7.71 yoy.
For the full year FY'14 vs FY'13,
Revenues stood at 1110 Cr vs 839 Cr, growth of 32%.
Net Profit stood at 221 Cr vs 101 Cr, growth of 118%.
EPS stood at 62.83 vs 28.78.
The consolidated numbers are having similar ratios, so not much to mention over there.
Consolidated EPS for the full year FY'14, stood at 66.54.
My Views:
Lots of positives to be taken from the Press Release as well as New Investor Presentation. The company has filed one more ANDA with US FDA, which takes the total tally of ANDA pending for approval to 21. The management expects 2-3 ANDA approval in FY15. 24 new products were launched in FY14, out of which 5 were in Q4. R&D expense stood at 50 Cr vs 37 Cr last year, which is highly encouraging.
The biggest positive is the growth in India sales. In Q4, company showed 33% growth in India sales, and for the full year, it stood at 32%. Such growth in India & other emerging markets will reduce the dependency of profit on dollar rupee fluctuations.
The only issue is with the update on their upcoming facilities in Gujarat. According to previous presentation, it was expected to be commercialized in Q1 FY'15, whereas in the latest presentation, it is being shown as Q1 FY'16. We will have to get clarity on that from the management.
Coming to stock price, I don't think, Rs fluctuation will make that big a difference going ahead, as their sales in emerging markets is growing very strong, especially in India. At CMP, the stock is trading at a P/E multiple of 16, which is fair. But the company should continue the growth in bottom line going ahead. Hence stock price appreciation should continue in my opinion, but can't guarantee the pace of moving ahead, as it has appreciated tremendously in past 2 years.
Recommending a hold for current investors, and those with good patience can look for new entry at current levels also, using every dips to buy more. Upgrading the target price to 1500 now, keeping long term view in mind.
All the best!!!
Hi Kunal,
ReplyDeletem holding only 65 shares of DHFL at avg price of 178. does Can Fin Homes looks better bet comapred to DHFL? can i shift to can fin homes as both are trading near price range?
what you think.
-Mayur
Mayur,
DeleteAs you rightly said, Can Fin Homes is strong fundamentally when compared with DHFL.
But even DHFL seems cheap. Can fin homes would have been a perfect bet, if you had bought around the suggested price, but even now, there seems to be much steam left for future.
There is nothing wrong in your move, and there should not be much thinking behind it, as in case, you are rotating the money in same sector, because, more often than not, the sector will perform as a whole, except on the day of some announcement by the respective companies.
All the best!!!!
will shift to can fin homes on any dips in can fin homes....also, thanks for guiding me on Granules...to book partial profits in step by step..like @350..then @450....so on....and really happy that I sold only 10 stocks earlier @325 n holding rest 90...Today it hit 400 mark...Cheers!
ReplyDelete- Mayur
Yes, partial profit booking is important, even in stocks where uptrend seems almost certain, because you never know, what can go wrong at a company level in future.
DeleteSo, its best if we try to minimize the risk from our side...
Other approach commonly used, is when your stocks go 2x or 3x from your buying price, then sell shares worth your initial investment, i.e. selling 50% in case of 2x and 33% in case of 3x, and then forget about remaining quantity, as in any case, you have got your invested money back. This seems to be the option, for highly safe players.
I, myself is following the first approach, as you mentioned :)
2 interesting reports on Ajanta Pharma..
ReplyDelete1) India Nivesh - Target of 1385 Rs
Link: http://www.indianivesh.in/Admin/Upload/635349653933890000_Ajanta%20Pharma_Q4FY14%20Result%20Update.pdf
2) India Equity Research - Target 1500 Rs
Link: http://www.datafilehost.com/d/8da2df07
What about Repco Kunal?
ReplyDeleteHi Kumar,
DeleteI generally tend to avoid policy driven stocks, but undervaluation is certain cases, force me to invest in those companies...
For eg., DHFL and Can Fin Homes suggested at 160 Rs and 140 Rs resp here, was just based on undervaluation. No doubt, their fundamentals are also good, but I don't prefer sector as a whole.
Talking about Repco, the fundamentals are again very good, but don't think there is any undervalution in that stock right now. It is fairly priced, but looking at their data, you can expect a better future.
Comparing it with its peer, Gruh, it looks cheap, but that is because, Gruh itself is very expensive.
To me, Repco looks fairly priced. You can expect stable returns going ahead.
Regards.
Hi Kunal,
ReplyDeleteArrow Coated Products reported excellent results. What kind of PE does this stock deserve? I think it is undervalued even at these levels. Everyday there are pending buy orders of 50k shares.
Sorry for the delayed response. Had a busy day...
DeleteResults were fabulous for the full year, no doubt about it.
On valuation front, I think it is mostly driven on the basis of continuous good news coming from the company.
It has market cap of more than 100 Cr now, and the consolidated sales are not even 40 Cr. It is not normal. The company has proved itself time and again, and hence the stock price.
In my opinion, I would rephrase your line slightly by saying that Company is not undervalued, but seems to have very bright future, and they should be able to justify the current rise in stock price.
Regards.
Hi Kunal,
ReplyDeleteWould request you to kindly go through Kanoria Chemical Industries in detail and whether it is worthwhile entering at CMP !!!!
And whether Dynemic Products is a buy at CMP of 33 ?
totalview
Good to see you after long time....
DeleteI will definitely take a look, but do you know, why their sales were heavily going down from FY09 to FY13, and why sudden change this time?
Dynemic is looking very attractive to me. I would be a buyer for long term here.
Regards.
Hi Kunal,
DeleteWas regularly posting as Anonymous :D !!!! Sales went down primarily because they had disposed of Units !!!! That's why you will have to go in-depth !!!! Cash Rich Company !!!!! Look at their overseas-ventures, etc. has moved up from 25-27 range to 32-33 range recently !!!!
Ricoh finally came out with delisting offer and share price has crossed 150 !!!!! Should get delisted above 180 at the minimum !!!!!!
Regards
totalview
Hi Kunal,
DeleteIn case of Dynemic, what is the attractiveness you find there ? Is it only undervaluation ? If it future growth prospects, why do you think that company can sustain the kind of growth they had last FY ? Are there any capex plan ? Have you had any interaction with the management ?
Thanking you in advance for taking pain to answer to my queries. I really appreciate that you find time to reply to each and every query from the readers.
Regards,
Vinod
Vinod,
DeleteMost of your questions on the company prospectus is answered in the main post here:
http://fundamentalstockideas.blogspot.in/2014/03/dynemic-products-name-behind-colors-of.html
Just visit their website and have a look at application of their products, the possibilities seems infinite. Don't think achieving 28% annual sales growth is that tough a task in such industry, if you are competent enough. Net profit growth is never a big attractive factor for me, being a long term investor.
Management also seems good and transparent. Out of 3.83 Rs per share earned for FY'13, they shared 1.3 Rs per share as dividend. This definitely is not normal.
Lets see what are they going to come up with this time, but I am expecting a dividend of 1.5 Rs per share this time along with good numbers.
But as I always say, don't enter the script if you have even a slightest of doubt in there. Better to enter late, but never before your satisfaction in the company's future.
Hope that helps.
Regards.
When is the results of Dynemic & Plastiblends?
ReplyDelete- mayur
Management of both the companies are yet to declare the date of results.
DeleteWill be posting in the sidebar widget called "Upcoming Q4 FY'14 Results", once the date is declared.
Ajanta Pharma Announces the Launch of Risperidone Tablets
ReplyDeleteLink: http://www.marketwatch.com/story/ajanta-pharma-announces-the-launch-of-risperidone-tablets-2014-05-09
Totalview,
ReplyDeleteI am going through the news surrounding Kanoria Chemicals. Few points mentioned by you are very valid and attractive. Will definitely dig in deeper.
Yeah, saw the news with Ricoh India. You might well achieve your initial estimated exit price of 200 Rs. :)
Hi Kunal,
ReplyDeleteWhat are your views on Rama pulp and papers.
Thanks
Going on right track, but company is too small to predict anything right now with market cap of 5 Cr.
DeleteNeed some more time, before being judgmental on it.
Dear Kunal,
ReplyDeleteDo you track Omnitex Industries? they have a 30% stake in Strata India who design geotextiles
One of the reason for not taking a deeper look into it is that the company itself does not have any core business. Only positive is this JV.
DeleteSuccess of Strata India on how infra sector picks up.
Again, I would say, its too early for me to form a judgement, with less than 10 Cr market cap.
Do u track any other companies from automobile, consumer goods, media, infra- cement, auto, agree etc..?
DeleteList of few stocks in my radar from all sectors... not to be taken as recommendation as of now.... just having a look...
Delete1) Aries Agro
2) Hawkins Cooker
3) Suprajit Engg
4) Oriental Chemicals & Carbon
5) V-Mart Retail
6) Tilaknagar Ind
7) Usher Agro
8) VST Tillers & Tractors
Not to be considered as recommendations as yet.
Like everything about Usher except debt!
ReplyDeleteIt is too early to be in alternative/green energy space.
This will mount debt further.
how do you look at pharma industry as most of the stocks has been re-rated thanks to mergers,delist, consolidation,in this respect do you track as ANUH pharma listed only in bse,in one of your replies you said you are not more interested in investing in pharma as you have already invested in ajanta and granules.and How do you see of wockhardt in view of clearance from FDA(if ).
ReplyDeleteIts not just Ajanta and Granules, but also Suven Life Sciences in our radar.... :)
ReplyDeleteRegarding Wockhardt, as I said earlier, if things go right for them, they once again deserve 4 figure mark, but uncertainty in the news flow surrounding the company, has brought lot of volatility in the stock price, which has stopped me from recommending it.
Not tracking Anuh Pharma.
Hi Kunal,
ReplyDeleteNow it is almost comfirmed that Modi will be the next Prime minister. Please recommend some more multibaggers. Also, I think there will be a major correction after some time in the market as NDA will not be able to perform as expected. Please share your views on this one and some more multibaggers.
Thanks
Jai Prakash Ahluwalia
We can't judge what is going to happen once the election results are out.
DeleteWe will have to wait for the govt to come out with their policies.
Regarding stocks, I have always posted the names that I am studying. So no more in the list right now, but once we see some positive outcome after govt formation, I will try to come up with some more names.
For now, lets wait and watch...
Hey Kinal, whats the reason behind DHFL rally today? just FYI..I havent switched to can fin homes..thought to stick with DHFL and seems to be good decision :)
ReplyDelete- Mayur
As I said earlier also, that DHFL too is undervalued.
DeleteI dont see any news today, it just might be the case of re-rating...
Can never predict what market has to offer... :)
ha ha ha !!!! DHFL went up today mainly because RJ mentioned it as most undervalued share in his portfolio in one of the interviews telecast today :D
DeleteHi Kunal,
DeletePlease give a ranking for investment based on CMP for Dai-ichi Karkaria, Plastiblends, Dynemic Products and Gulshan Polyols, all from the chemical or speciality chemical sector. Alternatively, you may apportion the %age of investment for each stock also.
totalview
Answer would mean that I am biased towards certain stocks, but not to be taken that way.. :)
DeleteConsidering the business, scope, and other fundamentals, I would rate them in below order,
Dynemic, Gulshan, Plastiblends, Dai-ichi..
But as said repeatedly, market has its own ways of rewarding stocks. So in terms of returns on investment over time, I won't distinguish them from each other...
FirstCall Research Report on Ajanta Pharma
ReplyDeleteLink: http://www.moneycontrol.com/mccode/news/article/article_pdf.php?autono=1084562&num=0
hi krunal ,
ReplyDeletei talking with u first time but follow your investment idea since 1 year . thanks very much sharing your ideas . i have query about granules and other midcap pharma review. exit poll favour bjp then effest on rs. positive so any effect on pharma share for nagativity . and would u like to any prefered stock for this event base investment.
thanks
nv
Hi Nirav,
DeleteThank you for the appreciation.
I won't be talking about the whole pharma world, but will give you clarifications on pharma stocks discussed here.
For Granules, it won't make much difference as per my discussion with management, as their expenses will also come down. So I dont expect any change as far as net profit is concerned, as they have natural hedge.
For Ajanta, they have very less revenues from US. So, dont expect much impact there also.
Suven is mainly in CRAMS business, which is already a high margin business. So, won't see this event as a big loss for them as well.
Regarding Rs depreciation, I don't know, how much of a impact NDA govt will have on it, and what will be the time frame for Rs ecovery and at what levels will it stabilize.
So, lets not be so pre-mature on it.
I dont think its time to sell out everything from pharma sector as of now.
Regarding new stocks, I have mentioned few above, that I am studying currently, and will start posting once the results aere out.
Regards.
Hello KB,
ReplyDeleteI came across your blog a week back. I was following other paid services before this. Gawdd!! I would have earned so much if I would have searched yours a few months back. Anyways, what is your suggestion towards Can fin homes. Is it a good buy at current price?
Warm Regards,
Rajat
Hi Rajat,
DeleteThanks for your kind words.
I know last few months. before the blue chip rally started, were really good for some of our stocks. But that doesn't mean, all our stocks will continue to perform well in short term.
All stocks suggested here are for long term investment, as most of them are small caps, or lower mid-caps. So sometimes, they also may take their own sweet time, before rewarding us.
Regarding Can Fin homes, it was one of the best investment around 140 levels, when it was recommended here, but looking their fundamentals especially the asset quality, it seems that there is still plenty of juice left in the counter.
Enter if you have good patience.
Regards.
Hi Kunal,
ReplyDeleteCould you have a look at Kanoria Chemicals?
totalview
Yes I did, but I am waiting for election outcome tomorrow, and company's result, day after tomorrow, before deriving any conclusion... :)
DeleteHi Kunal,
DeleteElection results have clearly given a five-year term undisturbed !!!! Politically there is nothing left except some of the States further going NDA-way either by way of fresh elections or falling on one pretext or the other. Exciting Months may be ahead particularly for Small-cap and Mid-cap stocks. Retail cannot resist the temptation of joining the bandwagon lock, stock and barrels :D !!!! I see re-rating of lots of small-caps !!!! Please do write about Kanoria Chemical. Do you think we are covering lots of Chemical stocks?
Excellent numbers from Kanoria Chemicals...
DeleteWith full year EPS of 7.7, it is trading cheaper at a P/E multiple of below 5...
Good dividend yield as well, with declaration of 1.5 Rs per share dividend..
Seems good to go..
Hi Kunal,
ReplyDeleteHope you do well !
Did you get a chance to look at Ybrant Digital ?
Also, Do you have any prefered stock in Media space?
Thanks
Sarath
Thanks
Hi Sarath,
DeleteI have that in my radar. Once we have the election outcome, I will put some of the selected stocks in the blog here gradually...
Regarding Ybrant, I am studying the competition in that market, and company's ability to withstand it...
Gulshan Polyols' promoters have again started purchasing from the market although the number is small but it's significant as the re-entry is at higher prices !!!! It looks they may reach maximum permissible 75% during the current financial year or next.
ReplyDeletetotalview
I do agree with you...
DeleteBut seems like on one hand, they want to buy quickly and reach 75%, and on the other it seems that they might be hesitant in buying at such higher levels..
Because earlier the issue was lower volumes on the counter but now, there are good volumes on daily basis, still, management is looking at buying in small quantity...
Hope something good is coming in quarterly results, plus a good dividend to go with that... :)
Kunal,
DeleteI am expecting at best a repeat of March 2013 as far as bottom-line is concerned. However, topline may be around 92-95 crores. Dividend pay out may be same i.e.50% !!!! However, FY14-15 should be considerably better than FY13-14 !!!!!
Hi Kunal,
DeletePromoters still require a good 2.30 lakh shares to reach 75% !!!!! Market has got total dematerialised stock of 19.20 lakh shares !!!! And if promoters' start buying a little aggressively prices will jump disproportionately. Hence their buying will be mostly of token nature just like honey-bee operations :D !!!!!!
totalview
Hmmm....good point...
DeleteSo is it advisable to enter in Gulshan at cmp?
ReplyDeleteYes, if you have a long term view.... it is still trading cheap...
DeletePhotoquip is slated to announce quarterly results on 30th May 2014 !!!! Do you think it's a long long term hold or buy at CMP? Results will be spectcular vis-a-vis last year because of big losses shown last year. Topline should also show upticks. But....
ReplyDeleteIts a buy but you need a high amount of patience... :)
DeleteCan you share your views on texmo pipes
ReplyDeleteGood one for long term, but may test your patience, because of already existing high liquidity in the counter...
DeleteDear Kunal have you gone through tyche industries with ROCE 20 and RONW 15 and EPS 6
ReplyDelete