JHS Svendgaard – An Oral Care FMCG Major In Making


(maheshkumar) #82

Do we consider tax benefit in quarterly result for calculation price to earning
Because of one off benefit Pe is very low
But next year the without this benefit Pe will be more than 50


(Sahil Taneja) #83

Latest interview of Nikhil Nanda where he talks about GST, oral market growth and new product launches: https://www.youtube.com/watch?v=FeqIcxPxxp8


(Sulla) #84

They keep converting warrants into shares. And the warrants were allotted at Rs.11. How does this augur to the minority share holders? Is the EPS calculated by taking into account the warrants? What is the reason for promoters to convert now? Are they planning to sell? If not, why do they want to convert to shares? Why not keep them as warrants, if they are sure that share prices will go up and convert then? Do they pay any extra money during conversion?


(J2EE Professional) #85

you are saying as if these warrants have appeared out of the blue. They have invested their money in turning around the company and were issued when the stock prices were around 10-11rs. And why would they issue warrants if they never wanted to covert them to shares. For your information if these warrants were not converted to shares then markets would hammer the stock prices to junk levels citing lack of confidence in the warrants holder to increase their stake in the company.


(Satya Prakash) #86

What is the reversal of tax amount of Rs 16.8 Cr in March quarter?
The company never paid such huge amount as tax then how come this is reverted?
Is this anything to do with P & G court case!

Today, 11.75 Cr invested through preferential-offer.


(Rudra Chowdhury) #87

Company has created a Deferred Tax Asset based on unabsorbed depreciation and carried forward business losses Link

This is allowed as per Ind AS link

Deferred tax asset assessment in case of carried forward losses
Under Ind AS 12, a deferred tax asset can be recognised on
the carried forward unused tax losses to the extent that it is
probable that future taxable profit will be available against
which the unused tax losses can be utilised. This is a lower
threshold compared to the virtual certainty supported by
convincing evidence presently required in order to recognise
deferred tax assets under Indian GAAP. This could potentially
result in the reporting of higher deferred tax assets upon the
adoption of Ind AS as compared to the current practice.


(Satya Prakash) #88

Thank you @Prdnt_investor.
I need to understand the point mentioned here. Without understanding it, I cannot make sense of it -

  • Good practice or not!

  • Where in Balance Sheet, it can affect in future.

  • What effect it can cause of bottom line.

If you already know about its affect then you can tell us.


(Pramod) #89

Detailed assessment of the company’s journey right from inception and IPO by alphainvesco/blog

https://www.alphainvesco.com/blog/jhs-svendgaard-laboratories/

Disclosure: invested


(Rahul Deshmukh) #90

As per my thinking, Converting warrants to shares is positive to company, they need to Buy from Open market, and there will be a timeframe till then need to wait for converting warrants to Shares to pledge or other use, others ideas are welcome


(Abhishek Basumallick) #91

The EPS of the core business (without the tax assets, which is NOT a cash inflow) is less than 1Rs/share for FY17. Even if I assume phenomenal growth in FY18, EPS can go to say 2-2.5 including the 27.5 cr from the P&G settlement. For a low margin, manufacturing outsourcing business, a reasonable PE would be 12-15. Even optimistically, if one applies a PE of 20, the FY18 end price could be 40-50.

Given that the CMP is already higher, the chances of a significant upmove seems unlikely.

Disclosure: Currently, invested.


(Ashwini Damani) #92

Please be a bit more humble in asking.
Please do some homework on your own
Please dont expect spoon feeding


(Sudheendra) #93

JHS Story is becoming interesting especially if no negative surprises from the key customers… MD’s statement in the latest annual report:

"Outlook
At JHS, we believe that guts lead to glory. Even as the Company was stabilizing its financial structure, it selected to expand the capacity of its toothbrush and toothpaste segments,aligning both. The Company expects to commission its capacity expansion by the second quarter of the current financial year and is expecting a 20-25% revenue growth on account of capacity expansion and another 10-15% by way of organic growth in the business.

We believe that these initiatives should increase revenues and widen margins,strengthening our business sustainability. "
Br, Sudheendra
Disc: Invested (5% of the portfolio)


(Invest) #95

If you believe fair value is 40-50 Rs, why are you still invested?

Kindly throw some light.


(Abhishek Basumallick) #96

I said I am currently invested. Did not say that I will remain invested in the future :slight_smile: It could also be the that I am bullish beyond the next 1 year :slight_smile:


(Satya Prakash) #97

June result is out.

Result is not good. Expense is high that has given muted profit in spite of higher sales.

Sales 29 vs 23 YoY.
EPS 2.8 vs 0.08. Basic EPS is more 3.71.

But exceptional gain has raised EPS.

It got 27.2 Cr from P & G in court case settlement


(bullrun1988) #98

I think we should consider the revenue growth for this quarter as govt implemented GST. So result is good as compare to other FMCG companies.


(harjotsingh87) #99

Also there is Excise duty of 2.53 cr which was not there last quarter. We need to dig deeper and understand where this is coming from.


(nitin.verma) #100

Results seem good to me.
Sales up 25%. PBT adjusted for exceptional gain due to P&G settlement and an excise expense would have been 2.64 cr as compared to 30 lakhs y-o-y . Need to find out more about this expense of 2.35 cr .
Capacity expansion in final stages. Would add to revenue from Q3.
The resignation of one independent director before results ?? An aberration
Disclosure:. Invested at 40 levels


(Satya Prakash) #103

But when expense is high then capacity expansion can result in more loss!


#104

Wouldn’t that be a hasty first level thinking? :slight_smile: While I agree that permanently increased operational expenses would result in more losses as capacity expands, not all type of expenses would have a similar outcome. As Nitin has already pointed out, the expenses have increased mainly due to the sudden appearance of the ‘Excise duty’ expense of R.2.53 Crore, without which the profit growth would have been positive both on YoY and QoQ. The nature of this expense need to be cleared with the company. A quick look at the past 5 quarterly result reports suggest that this expense is indeed exceptional and might not recur in the subsequent quarters. IMHO, it is a decent quarterly result with the trend of profitability being maintained for the last 5 quarters. The one time settlement from P&G is a timely shot in the arm for the expansion plans without resorting to the debt route. Hopefully the fruits of expansion will be reflected in both the topline and bottomline of Q2/Q3.