Shasun Pharma - Excellent Results

Shasun Pharmaceuticals has declared its third quarter results.

Its Q3 net profit was up at Rs 12.6 crore versus Rs 36 lakh, YoY. The company's net sales were up at Rs 205 crore versus Rs 142 crore, YoY.

In a recent development, Shasun Pharma Solutions Limited (SPSL), the UK-based subsidiary of Chennai’s Shasun Pharmaceuticals Limited, has received around GBP (Great Britain Pound) 400,000 (close to Rs 3.2 crore ) grant from the UK government’s investment package, which is meant to generate more job opportunities in the region.

The grant accounts for around 20 per cent of the company's investment of GBP 2 million (Rs 16 crore) made recently in its plant in Dudley, UK. The company has built up capacity for niche product manufacturing segments with the investment, and is expecting around GBP 5 million annually from the new technologies installed, said S Abhaya Kumar, managing director, Shasun Pharmaceuticals.

“We expect the new capacities to increase our support to the custom-synthesis and contract manufacturing customers. This will also reflect on the top line and bottom line of our business,” Kumar said. The company has developed niche capabilities in critical reactions like ethylene reactions, which would help it serve its customers in these technologies.

The company was selected for the grant, along with few other companies including Piramal Healthcare UK which has a facility at Morpeth, since the investment had generated more job opportunities. Expansion of SPSL has created opportunity for around 20 people afresh in the Dudley facility.

“The new technology and capability we have built up will provide us around GBP 5 million (Rs 40 crore) business annually in future,” he said.

With the expanded capacity, the company expects its top line to be around GBP 44 million (Rs 352 crore), while the bottom line is expected to grow 13 per cent. SPSL has posted a top line of GBP 37 million (Rs 296 crore) last year. Shasun Pharmaceuticals acquired UK-based pharma company Rhodia Pharma Solutions in 2006 and renamed it as Shasun Pharma Solutions.

According to information available with the company till the end of November 2011, the UK subsidiary has a pre-launch pipeline of 19 projects in the second and third phase of clinical study. Currently, it has a contract manufacturing portfolio of around 28 launched products.

Shasun Pharmceuticals’ manufacturing unit at Visakhapatnam in Andhra Pradesh is expected to be commissioned by July-August 2012, Kumar said.

[source:http://www.business-standard.com/india/news/shasun-pharmas-arm-gets-uk-govt-grant/457742]

This shows that company is in its growth path and strengthens my confidence in it. Slowly and steadily, this is going to achieve greater heights.

HAPPY NEW YEAR 2012

WISH ALL MY READERS

A VERY HAPPY & A PROSPEROUS

NEW YEAR 2012

Agre Developers - Potential beneficairy of FDI in Retail !

Union Cabinet approves 51% FDI in multi-brand retail and raise the cap on FDI in single-brand retailing to 100% from 51%.

An excellent move by the Govt. at the time when it was very much needed. A much delayed reform expected to help unclog supply bottlenecks and ease inflation over time. India will open the country's retail industry to foreign supermarkets.

There will be lot of beneficiaries of this move, as covered in media, like Pantaloons Retail, Shoppers Stop, Spencers Retail (Subsidiary of CESC), Trent etc. But there is one more company from the Future Group, which is not in limelight is Agre Developers.

About the Company -

Agre Developers Limited aims to create a capital-light, partnered real estate development model, focused on retail real estate, infra-logistics parks and the development of wholesale markets. Demerged from Pantaloon Retail (India) Limited with effect from 1st Apr 2010, Agre was listed on BSE and NSE on 31st Dec 2010.

Through retail-led real estate developments and asset management, Agre integrates operational as well as retail-specific aspects throughout an asset’s lifespan. In collaboration with Future Supply Chain Solutions Ltd., Agre aims to setup Infra-logistics parks across the country. With best-in-class facilities and easy access to transportation networks and hubs, our logistics assets will cater to a wide range of industrial distribution needs.

The retail market environment in India faces a long-run increase in demand and increased competition in wholesale trade and business. To balance supply constraints, Agre aims to set up modernized wholesale markets across major cities and other market-centric locations across the country.

Businesses -

With a strong domestic economy, increased consumption and favourable demographics, the retail revolution in India has given rise to increased demand for retail-led real estate developments.

Agre’s vision is to create a capital-light, partnered real estate development model, focused on the retail, wholesale market, residential and infra-logistics verticals. Agre is committed to bring state-of-the-art real-estate solutions to India to benefit investors and customers.

They have following businesses -

1. Mall Management - In today’s dynamic market place, mall differentiation, optimized operational expenses and enhanced efficiencies are the key to long-term value creation. Agre understands the needs of retailers and helps manage retail environments on a sustainable basis.

2. Project Management - To meet the rising demands of cost-efficient and on-time delivery of real-estate developments, Agre has an established team of professionals with deep experience in design and construction projects. By leveraging our experience and knowledge of local markets, we aim to serve project and construction management requirements across the country.

3. Food Service Management - Food courts drive business in a mall and are integral to its success. Agre provides efficient food services management to lease, run and promote food courts that helps retailers improve customer satisfaction and loyalty while increasing throughput.

4. Wholesale Markets - The retail market environment in India faces a long-run increase in demand and increased competition in wholesale trade and business. To balance supply constraints, Agre aims to set up modernized wholesale markets across the country.

5. Infra-Logistics -Agre is looking at attractive investment destinations across the country to set up integrated infrastructure projects such as infra-logistics parks.

6. Residential - Agre aims to shape the skyline of residential real-estate with affordable and uniquely designed apartment enclaves, flats and residential properties.

Financials -

Market Cap 45.91
* EPS (TTM) 0.21
* P/E 195.71
* P/C 102.75
* Book Value 236.26
* Price/Book 0.17
Face Value 10.00

Financials may not look decent right now, as we need to view the future growth potential of the company. Book value is very much comforting and stands at a whopping Rs.236. Buy this stock for a view of 5 years and you will discover a multi-bagger in your portfolio.

Shasun Pharmaceuticals - Potential Multibagger !

About the Company -

Shasun Pharmaceuticals Limited was incorporated in 1976 and is headquartered in Chennai, India. It manufactures active pharmaceutical ingredients (APIs), their intermediates and enteric coating excipients with a significant presence in some key generics. Shasun has created a strong product portfolio, building on its R & D Expertise, regulatory capabilities and multi scale production capacities. Shasun has also emerged as a key player in various service segments in the pharmaceutical field besides APIs and intermediaries, and is strengthening its offer of contract research, custom synthesis, contract manufacturing and contract formulation services to clients.

Today, Shasun is one of the largest producers of Ibuprofen worldwide. The company offers derivatives of Ibuprofen like Ibuprofen Sodium, Ibuprofen Lysinate and S+Ibuprofen. It is also one of the major producers of Ranitidine and Nizatidine in the world. Its products are exported to countries across North America, Europe, Asia and Latin America.

It has tied up with multinational companies in the formulations space wherein it will be developing and supplying products for the US market. The recent acquisition of the business and facilities of Rhodia Pharma Solutions by Shasun's wholly owned subsidiary Shasun Pharma Solutions Ltd (SPSL), UK equipped the company to evolve as a technology based service provider than as a contract manufacturing and research provider.


Future growth trigger -

Nano-technology joint venture project for cancer cure with US-based Nanoparticle Biochem Inc.

Shasun Pharmaceuticals plans to invest Rs 100 crore in two years on expansion plans. A part of this will be funded through external commercial borrowings of $6 million.

The company’s main thrust will be on a nano-technology joint venture project for cancer cure with US-based Nanoparticle Biochem Inc, with the support of University of Missouri.

“When radioactive gold nano-particles are injected in solid tumour, it can kill the tumour in 30 days, without the need for external chemo or radiotherapy,” said Mr S. Abhaya Kumar, Managing Director, Shasun. Trials on dogs and pigs are set to begin in August. Shasun will have the world-wide rights over this product.

Around $2 million will be invested in the nanotech project in two years. Already, $300,000 has been invested.

The joint venture is also planning to come out with a gel-like application for wound healing, delivered through nano-fibres.

Shasun mainly manufactures APIs for several pharmaceutical companies globally. It recently entered the branded market in India with the launch of a diabetes product and a blood-thinning drug, in Tamil Nadu. Plans are on to launch products for renal failure, cholesterol management and an over-the-counter pain ointment.

The company, which has plants in Puducherry and Cuddalore, also hopes to revive plans for a manufacturing facility in Vizag. Shasun’s mainstay business of ibuprofen will see more derivatives this year.

For the first quarter of FY2012, Shasun has reported a marginal 2 per cent rise in net sakes (consolidated) to Rs 196 crore over the same period last year. Net profit for the quarter was Rs 6.83 crore, against a loss of Rs 2.34 crore last year.

Shasun’s UK subsidiary is also looking good, said Mr Abhaya Kumar. It had posted profits for the first time in Q4 last year after being in the red for five years. (Shasun had acquired the ailing UK pharma company, Rhodia in 2006 and this was renamed Shasun Pharma Solutions.)

The UK subsidiary posted a turnover of Rs 68.90 crore in Q1 FY12 with profit after tax of Rs 4.91 crore compared to turnover of Rs 64.21 crore and profit of Rs 5.01 crores in Q1 FY11. The pre-launch pipeline has 16 live projects spanning clinical phase II and III.

Source - http://www.thehindubusinessline.com/companies/article2305746.ece

This is for sure will propell the top-line and bottom-line significantly. Serious long term investors should start accumulating in the range Rs.55-65 and keep holding for more than 2 years to see the true potential of the company.

Muhurat Buys - Samvat 2068

....Wish all the readers a very Happy and a Prosperous Diwali....

Here are few picks for the next year starting with Large-cap stocks, which are going to give decent returns

Banks:
ICICI Bank
HDFC Bank
Axis Bank

Auto:
M&M
Tata Motors

Oil & Gas:
Reliance Ind

Mining & Minerals:
Coal India

Engineering/Capital Goods:
Larsen & Toubro

FMCG:
ITC

Pharma:
Sun Pharma

Telecom:
Bharti Airtel


And, other Mid-cap Stocks ideas for next year:
1. Godrej Industries
2. Videocon Ind
3. United Spirits
4. YES Bank
5. Coromandel Int
6. Dish TV
7. Tata Coffee
8. VIP Industries
9. Supreme Ind
10. Everest Ind
11. Cera Sanitary
12. Cravatex
13. TTK Prestige
14. Page Ind
15. Info Edge
16. Bombay Dyeing
17. HOEC
18. Spicejet
19. Lovable Lingere
20. Jubilant Foods

Have a great Samvat 2068 !