Hi Deep,
Reading the AR,I too get the same sense.Since you attended the AGM,your conviction would be higher.Chances of a change in fortune look high.Looks the company is going through a change in its biz model(something like Lupin did,a few years ago) Even in the past,they have been successful in doing this(in 2001,Biocon entered the biopharma segment & the revenues went 2X-3X by 2004) KMS has also promised a revenue of 1 billion USD by 2018(presently it is 328 million USD,assuming a Dollar rate of 59)
The only overhang is the volatility in quarterly nos.,which needs to be rectified.
Still,its certainly worth a shot.
Any professional opinion of Alzumab, KMS was talking very highly of it yesterday.
Alzumab
is.With
Biocon.
She was recommending Alzumab (incasualconversations) to some of us if we know anyone suffering from it and apparently it has good potential for other autoimmune diseases - which all put together is a multi billion market potentially! Given Biocon’s history the drug should be affordable - In their AR they compare the current options and it is more effective with much less side effects.
As you rightly point out the stock will face lots ofresistanceon the way up given the recently history over last few years - But one of these catalysts if works out can result into a large enough move to cross all these hurdles.
Well my conviction has been high for last two years and the stock has done nothing :-). The Billion dollar target does not factor upsides from any novel molecules. I thinks its like recoiled spring, and whenever the business delivers (very likely in next 3 years) it will make up for it. The doubt if any is the opportunity cost of capital.
I dont track it too closely but had a look at the latest quarter results and they seem to be encouraging. .There is an element of one time milestone payment which has propped up the net profit but even without that numbers look good.
I think at cmp it can be a good buy based on numbers.
Never buy a Falling Knife…I Learnt it the hard way. Keep off Financial Technology. If all is good, we can always enter later…At Best, there is an opportunity cost loss
There is a regulatory issue with National Spot Exchange(financial tech being one of the promoters) where more than 10 days contracts are suspended in all sec except e series. This is as per the FCRA regulation. Need to wait before taking any call.
With the recent correction in indusind and esp gruh, the switch you mention seems attractive. Wimplast is a good company with cheap valuations but it will need a great bull market to take in on an upward trajectory.
whats your view on Colgate at cmp?. i know that p&g is entering toothpaste in india. but in fmcg competitionwill always be there. nothing new there. on a PEG basis this appears expensive but as you know PE is not a function of growth alone. and moreover compared to the other high quality fmcg names, this is the cheapest. appreciate your valuable inputs
Thanks a lot Hitesh Bhai. Have you looked at Atul Auto’s July Sales numbers? Seems that the company is beating the overall industry slowdown? Can we look to accumulate it?
@ankit, atul auto is certainly doing well in a bad environment… But the overall dampened sentiment for the sector will continue to play on the stock price…
There could be a lot of reasons for preference for gruh… most imp of them being
first look and compare the ROE, ROA etc of both companies.
Second, look at the parentage of both companies.
Thirdly look at the past and consistent track record of gruh… In case of gruh you can almost predict a 25% cagr growth for next few years. unless this govt comes out with a rabbit out of the hat.
We dont have to look at the immediate quarters only while investing for long term. Its always a good idea to look at past few years although that does not mean that same track record will continue in next few years but it gives a better perspective at investing.
For further clarifications you can read Five rules for successful stock investing by PAT DORSEY… Any serious long term investor should read that book preferably multiple times…
Couldn’t agree more Hitesh bhai. Awesome book that is. People often talk about books like Intelligent investor, Security analysis etc. I find them a little complicated and somewhat boring. ( No offence meant). Somehow this Five rules book by Pat Dorsey hasn’t got the recognition it deserves. Wonder why.
In my opinion this and One up on wall street are a must for any investor.
I fully agree with you. I am presently reading the book by Pat Dorsey titled THE FIVE RULES FOR SUCCESSFUL INVESTING. Its an amazing book. For those who would like to have a copy of the book, I would be pleased to share it with them.
One should also read an article which appeared in Forbes India, March, 2013. The stock has risen more than 5 times in the last 5 years. For that to happen, the company must be doing something right. The company has a loan book of 5000 crores and NPA of 0.52%. The price of stock has doubled in the last one year. And to cap it all the company is a subsidiary of HDFC.
