Granules India Ltd

(Vilas D'Souza) #743

How does pledge impact the stock price? So long as the interest n principal repayments are ok, pledging shouldn’t impact

(Sarabjeet Singh) #744

@vagator10 : Answer is there in your statement itself. Its safe as long as Interest and Principal are going. Assuming promotors majority income is from Dividend and Salary. Incase of any short term downtrend company doesnt do well for couple of quarters then dividend income could be hit and repayments affected.

Another scenario which happened recently, due to overall downtrend in market itself, share price got hammered and Promotors had to pledge more shares as collateral for the borrowed money. What if promoters didnt had more share, bank would have sold the pledged ones in open mkt severely affecting the stock price.

Operators can take advantage of situation 2 and try hammering the stock so much that Promotor runs out of options and eventually Bank had to sell to safeguard its money.

Excessive Debt in any form is bad !

(Vilas D'Souza) #745

Very well said. The eps growth seems to suggest that the business is earning above the cost of borrowing,( of course we know that they’re capitalizing the interest cost). With the stock price having rebounded, it remains to be seen if pledge goes down or the promoters use the price rise to raise more debt.

(mrai74) #746

Annual Report shows net debt has increased considerably

(Vilas D'Souza) #747

D/E is ~0.8. the ratio per share matters

(Vilas D'Souza) #748

I couldn’t get the debtors ageing in the AR. It’s an area of concern. Can someone share it if u have?

(mrai74) #749

Something to cheer up!!! can someone convert its impact on top line / bottom line

(Vilas D'Souza) #750

I looked up sales of zantag but couldn’t get more info. This is used to treat heart burn and stomach ulcers or acidity

(Krishna Rai) #751

It seems that it was about 125 million USD last year
However I am unclear on multiple accounts and so not able to infer something meaningful. Here are the reasons
1- The title of the article says that stat is for 2103 while the page content calls out distribution for 2017 (may be a trivial content issue)
2- I do not know what percentage of this sales could come to Granules over the next one year or so. Typically when generic drugs are launched then price falls by about 60%. In this case I am unaware if generic drug is already launched or this is the first one. If there are other generic drugs already in the market then price would not fall else price would correct. In any case Granules has to fight out to capture market.

Nevertheless, it’s a good news.


(mrai74) #752

Did anyone attend the AGM? based on recent upswing in price / volume… excited to know management’s views / future plans

(Vilas D'Souza) #753

Price action doesn’t mean anything relative to an event. There was no news to back this move so the stock might go back down.

It’ll be more productive to discuss the AGM takeaways if anyone attended.

(mrai74) #754

MF holdings have shown north ward movement from last 2 months… it is interesting to note that it was on decline during May-June & has turned reverse in July-August

The no of MFs holding our company has gone down from 18 to 16. Interesting entrants are Kotak & BNP while L&T and SBI have made exit