Cupid Ltd – Helping the world play safe!

(mrai74) #973

Cupid gave 1:5 bonus and record date will be within 2 months from now i.e. October 23, 2018

I expect 30% appreciation around record date… so ultimately ex bonus prices will be around 260 … let us hope that we get better Q2 results on top of recent SA orders to give much needed boost to share prices as well

(atul1082) #974

30% appreciation​ with bonus news?

(Manojlion) #975

I had gone through PDF…Detailed numbers much appreciated :slight_smile:
However could not find the record date.Oct 23 is the mentioned date by which bonus shares will be dispatched. Is it the record date as well

(mrai74) #976


(Vilas D'Souza) #977

Why would you expect a spike near the record date? Anything special about the bonus?

(mrai74) #978

Probably we will have two events in October, first being bonus & another Q2 result. As we have oredrs in hand, execution remains the key & certainly next 2 months should show some light. Considering both events, I expect certain appreciation, which may vary with other individuals.

Ideally there shouldn’t be any impact on prices (except proportional adjustment) due to bonus but historically we have observed extra movement around bonus / split etc. As per details available in BSE filing, bonus date may be around Q2 result season & I expect some spike around that period.

(devarshi84) #979

Wasn’t Cupid a contract condom manufacturer for other brands like Playboy? Do they still do it? If not why is such an opportunity not exploited?

Also, can somebody emphasise on the utility of the bonus issue? EPS hasn’t risen exponentially.

(Vilas D'Souza) #980

Never heard they were associated with Playboy. Raise this in the AGM if you or anyone from the blog is attending.

Bonus was declared to commemorate investors on the occasion of silver jubilee. The ratio is conservative. What remains to be seen is whether the dividend payout per share is maintained or slashed due to bonus.

The bonus says good about the promoter. Larsen chose a tax effective way of rewarding shareholders thru buyback… they have a debt in excess of 1 lakh crore, so can’t fathom the buyback.

(devarshi84) #981

I remember seeing Cupid website before with some other brands of condoms as well. But my memory might not be correct due to information overflow.

But if not, Cupid should look at contract manufacturing to use idle capacity and increase sales and visibility.

Their government orders and skills in making female condoms are already an asset that other brands like Playboy and Trojan can capitalize on, thanks to Cheap Indian Manufacturing.

(Vilas D'Souza) #982

Please suggest these in the AGM. M pretty sure the management would’ve thought thru this.

(chetanb) #984

Veru, the global FC2 company, got 75% of the South African FC order. Negative for Cupid.

(Manojlion) #985

What is the source of information brother

(Dinesh Sairam) #986

However, this was already discussed in the latest Concall. Well, at least it was hinted that Cupid would get around 20-22% of the order, with some additional order possibilities once the JV is setup (Wherein it was specifically stated that the SA Govt has promised to take up the entire capacity of the JV, which is planned to be around 16 mn).

(Vilas D'Souza) #987

So some quick questions:

  1. Is Veru the same company that bagged the most of the first year’s orders? i.e.FHC? Or veru sprung a surprise as an unexpected bagger?

If veru isn’t fhc and the 40 mn order was finalized between fhc, cupid and HLL, then how come veru bagged 75% of the total order? The remaining order was 80 MN pieces which is 67% of the total. So in this case, veru can bag at most 67%, unless any part of the first year’s order was retendered.

  1. I thought that total imports = 80 MN and JV = 40 mn (meaning 67% imports and 33% JV). Veru bagging 75% of the orders meaning 90 mn pieces? So is it that the JV share is down now?

(mrai74) #988

Overall Tender is for Up to 120 Million Female Condoms Over Three Years

Veru awarded Up to 29.8 Million FC2 Female Condoms of 40 Million Total for First Year

Overall looks nothing lost for Cupid & we are on track for 100 Cr top line this year

(Dinesh Sairam) #989

Veru Healthcare and FHC(O) are the same. There are only 4 players in the global B2G2C Contraceptives market - Cupid, FHC, HLL and a Chinese player.

Last year’s order book was 63 Cr. This quarter saw a dispatch of 17 Cr worth of orders. Along with the new order of 40 Cr from the JV and 9 Cr (The remaining 22% allocation apart from FHC’s 75%), the current order book stands at 95 Cr. How much of this will be executed remains to be seen. This is only for the first tranhce (40 Cr) of the 120 Cr requirement for 3 years. The remaining (80 Cr) requirement isn’t allocated yet. According to the concall, Cupid is expecting a bigger piece of the pie for the latter allocations.

A 10% growth in topline from last year would demand Cupid to execute an average of around ~24 Cr for the remaining quarters in the year (or) 75% of the current order book (Which sounds a little steep in my opinion).

Assuming that the JV executes the production of 16 mn, at an average rate of Rs. 20 (Say), Cupid will be privy to ~16 Cr worth of Revenues (16 * 20 * 49% / 10), although this will come by way of Capital Appreciation, rather than an actual increase in topline. I’d be interested in understanding how Cupid Values the JV in its books.

The JV has not begun operations as yet. However, once it does, Cupid will get a one-time payment from the JV for import of raw materials from India (Cupid’s unused raw material, that is). This could also help a little with the topline this year. After that, Cupid will only benefit via the Capital Appreciation of its 49% stake in the JV and a small (5%) royalty payment every year. The positive here being, the SA government has promised to take up almost all the production done by the JV and this could possibly be a medium-term to long-term (As of now, 5 year) engagement.

TLDR: The news of FHC winning 75% of the first tranche has no bearing on Cupid, at least to the extent that it’s already been discussed by the management.

(Growth_without Debt) #990

3 year allocation criteria in tender

(Vilas D'Souza) #991

(Manojlion) #992

please share the url to that tender image bro @hnk_so

Going by the image you shared,

For the female condoms,60% will be local produced in 2019 80% will be local produced in 2020 and 100% will be local produced in 2021 and 2022 which is a great news for Cupid JV

For male condoms and lubricants,I think there are local producers already I believe

Pls correct me if I am wrong @dineshssairam sir

(Dinesh Sairam) #993

True, but the other players will also try to get into a similar arrangement (A JV or a full-blow manufacturing plant) in SA. There’s no free lunch. We’ll have to wait and see if Cupid has some kind of counter-measure for this. Currently, the only way I see Cupid doing this is by executing the present JV orders skillfully and at attractive margins to the government.

I’m more interested in how the company approaches other markets like India, US and Europe (Still no update on how the Cupid Angel line is working out in Europe so far).

What I really admired is Cupid’s swiftness in responding to the adverse situation (SA government wanting to produce Condoms locally). I just hope the new CEO is just as good as Mr. Garg.