Poly Medicure - at an inflection point!


(S Khan) #61

Based on the news report , i am not clear whether poly medicure or its promoters did anything wrong ? They just purchased land from vadra by legal channels by paying the market price . Vadra ofcourse would have made a killing on these deals . iam sure they are one of many many companies who might have bought land from vadra.

Also , if the deal itself is wrong , the size of deals is quite low to have any material impact on poly ,also it looks like Bhushan steel is more “culpable” as poly , as the money for land purchase came indirectly from them . Bhushan steel barely budged yesterday but poly being a very low volume stockcrashed and recoveredsoon . its difficult to assess at this point ,how these events will pan out and what this “taint” could do to poly medicure .

my allocation is less than 5% at this pointand i continue to wait and watch . i was actually in process of accumulating the stock slowly as i find the business very promosing but will hold off on that .


(saurabh shankar) #62

Hi,

I am not sure if the promoters entered into a deal. The company which has done the transactions is BS Trade Invest Pvt. Ltd , which entered as an investor in company in Dec 2010 Qtr.

I tried to look up for promoters of this company, but due to the pathetically slow MCA site, was just able to get the names of directors a lady called sangeeta bohra & kulvansh sing…whose names ihaven’tseen in Poly-Med’s AR’s.

Not adding though, but trying to dig more.


(Hemant V Bhatia) #63

I feel,we should not over look the fact that BS Trade Invest Pvt. Ltd & Allegeny Finlease are connected,further as mentioned in the write up the email of BS Trade was same as that of polymed.So it is obvious that this two firm which are collectively holding 25.17 percent shares are of promoters,though to stock exchanges they are shown as investors.Further it was clearly mentioned that land deal was done at much higher then market rate.


(Raj Panda) #64

I am with you Hemant on this. you mentioned exactly the reasons, that played on my mind too. I don’t want to be CID/CBI on such cases. Let some time pass and either the issue die it’s natural death or get solved to a logical conclusion. Although the price of land deal shouldn’t be a concern for poly med share holders as it’s not paid from the company’s accounts.


(bagdu) #65

Mostly there is never a single cockroach in the kitchen. I could never digest the famed derivatives loss theory of the Poly medicure. As a quid pro quo they might have got orders from health ministry. Better to be safe than sorry. If you keep waiting, Godot might never come.


(Ramakrishna) #66

Hi Raj and Hemant,

I concur with you and to be on safe side i have exited the counter for the time being. Will review after the dust settles down.

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Regards

I feel,we should not over look the fact that BS Trade Invest Pvt. Ltd & Allegeny Finlease are connected,further as mentioned in the write up the email of BS Trade was same as that of polymed.So it is obvious that this two firm which are collectively holding 25.17 percent shares are of promoters,though to stock exchanges they are shown as investors.Further it was clearly mentioned that land deal was done at much higher then market rate.


(Ayush Mittal) #67

It was surprising to see name of Polymed come up in this issue. Though a negative as it impacts the image of promoters and hence the higher valuations. The only comforting thing was that the co was not directly involved.

On further personal discussions with people connected to this industry, I was told that as the latest solar policy is very attractive for this area and people would be getting assured good returns, hence lot many promoters have jumped in and bought lands. The bad part is that the counter party was Vadra and now the issue has come up.

Whenever such things come up, I feel sad about the state of the things in India and it just highlights the inherit risks with almost every other co. Given the systematic problems and ground realities, there are lots of such ground level and practical problems and out of blue moon some unexpected things come up in every few years. This is another reason why we keep a bit diversified portfolio in the mid/small cap space.

Ayush

PS: Have done some profit booking.


(Vimal Dixit) #68

Ayush…I feel eventually earnings and growth will matter more for investors rather than ST hiccups…I also saw that counter was almost static with small rangebound movement for long till over all meltdown intensified…I may be wrong but feel if goes further down shall be good long term buy…Iam bullish on the company considering the products they are in.


(Hemant V Bhatia) #69

Ayush,

if you say, comforting thing was that the co was not directly involved,but then how will you justify email of BS Trade was same as that of Polymed. Stock with low liquidity (as promoters indirectly holds 74 %)may remain high,but then we are playing with fire.(Well some might say there is lot of fire at stock exchanges,so why complain on this :slight_smile:


(Ayush Mittal) #70

@Vimal : I agree on the the long term prospects of the co

@Hemant: By co not being directly involved, I mean that the co has not invested its funds and hence can’t be a party in any litigation as such and this should be a comfort.

Over longer term, the co has a good business model and has done very well.

Ayush


(Deepak Swamy) #71

Q4/Fy-13 Results out…

Total Income up 20.9% to 69.12 Cr from 57.15 Cr.
EBIDTA up 38.9% to 16.97 Cr from 12.22 Cr.
Net Profit up 79.7% to 9.25 Cr from 5.15 Cr.

EBIDTA margin is 24.6% v/s 26.1% (Q3-13) and 21.4% (Q4-12)
NET Profit margin is 13.4% v/s 13.1% (Q3-13) and 9% (Q4-12)

Total Raw material costs as a %ge to Income is 32.7% v/s 32.1% (Q3-13) and 30.6% (Q4-12)
Employee costs to Income is 16.1% v/s 15.8% (Q3-13) and 13.5% (Q4-12)
Other expenses to Income is 26.7% v/s 26% (Q3-13) and 34.6% (Q4-12)

Financial costs to EBIT is 4.1% v/s 14.1% (Q3-13) and 20.7% (Q4-12)

Tax Rate 31% v/s 28.9% (Q3-13) and 34.9% (Q4-12)

Reduction in other expenses (which includes forex gain/loss) helped EBIDTA.
Savings in Financial costs helped Net profits.

Fy-13 v/s Fy-12 (Consolidated):
Total Income up 19.7% to 259.75 Cr from 217.03 Cr
EBIDTA up 10.1% to 51.66 Cr from 46.91 Cr
Net Profit up 24.4% to 24.23 Cr from 19.47 Cr

Reported Full-Year Consolidated EPS 22 v/s 17.68

On 13/05/2013, stock on NSE closed flat at Rs. 510/-
(Results declared after market hours)


(Akbar Khan) #72

They have a 15 Cr loss from Foreign exchange during the quarter. looks like the Forex woes continue.


(Raj Panda) #73

As per the notes to accounts point no. 7, they have made net foreign exchange gain of 78.71 lacs for the quarter and 1574.16 lacs of loss for the year towards.

Profit figures are accurate as per projected numbers from Donald - 24.09 Vs actual of 23.27. If were to theroretically add the 15.74 cr. of forex loss figure to profit for next year, then the estimate for next year is easily 39 cr. without accounting for any growth and 45 cr. looks achievable with 15% growth.

At current valuation of Mcap of 570 cr. it’s trading at 12x of FY14 PAT figures.

Not very happy with the dividend payout ratio of just 10%, but take heart from this point in the mgmt. Q&A

We should do well and keep growing at 20-25%. Margins will improve. Cash Flows will improve significantly. In 2-3 years we should be in a happy cash-surplus situation.

Is it time for another management meeting to clarify on the Vadra issue, and confirm that thenew manufacturing unit (at SEZ Jaipur) which was to go on stream by Quarter 3 of the Financial Year 2013-14 is on track ?


(Ayush Mittal) #74

1:1 Bonus from Poly Medicure! The results look decent and as per our expectations.

Ayush


(Ayush Mittal) #75

Div is Rs 2 on post bonus equity. Hence the payout will go higher if we are calculating it on reportedprofits.


(Vimal Dixit) #76

…expected Bonus and decent results should reignite the fire …why is market giving cold shoulder…seniors please chuck in


(Akbar Khan) #77

Ya… that’s right … it is for the full year, not quarter. Thanks Raj.


(Raj Panda) #78

Ah !! I see, then better.

reportedprofits.


(Mallikarjun) #79

Hi Ayush

Have some concerns about cross share holding pattern of poly medicure. Considering the business they are in why haven’t any institutional shareholders got into it. Is it because of liquidity.

Intend to increase the allocation to poly medicure. How do you rate the management

Regards

mallikarjun


(Vimal Dixit) #80

Price have adjusted to Bonus few days back however Bonus Shares not yet credited in Demat a/c.

Other Boarders holding Polymed pls come in.