Piramal raised 2,590 cr from Farallon Capital
With equity of Rs.13,000 Cr. and Cash of Rs.4,000 Cr and investments in Shriram Group of Rs.5,000+ Cr. financials are been given a discount due to likely loss. I feel they would need Rs.4,000 Cr. to Rs.10,000 Cr to clean the book. Which nets of the available cash and investment in Shriram Group.
^ these kind of arbitrary discounts were being applied even when the stock was at 600
Selling 20% stake in pharma business for an equity value of $490M and enterprise value of $2.7B with an upside of $360M based on FY21 performance - Link
This is better valuation than mentioned in articles.
carlyle paid $490M , for 20% stake in piramal pharma.
since money goes to pirmal pharama & not piramal enterprise , carlyl will end up owning 20% of money they paid , that is 98 crores.
so in effectively carlyle paid 490 -98 = $392M for piramal pharmas 20% stake .
so total valuation of piramal pharma before the transaction should be 392*5 = $1960M that is approx Rs 13800 crores
since piramal pharamas revenue itself is Rs 5400 cr , the valuation is just 2.5 X slaes which is just avearge & not anywhere near great valuation
I didnât got this math, why 98M $ are reduced from 490M $. They are paying ~490M $ for 20% stake of Piramal Pharma business with EV of business at 2778 M $. Final amount is subject to change based on performance of piramal pharma in current FY.
Looks like Piramal is going to make a comeback in Pharma in a big way. This partnership can bring lot to the table in addition to the money. Seems like a good long term story on pharma side of the business
Piramal continues to forge ahead with Pharma division while market remains focused on its real estate loansâŚ
Recent earning conference call transcript
Seems this is a premium contentâŚcan someone write gist of itâŚwas it about PEL?
RBI alerts FIU on certain large family biz owned NBFCs, being used to primarily cater to the debt needs of their group companies
Hyd based infra group, a Mumbai-based NBFC backed by a leading pharma company & an NBFC owned by a Kolkata-based steel company are under scanner
This news was in the Economic Times newspaper yesterday. I donât think any listed NBFCs under scanner here. One of the paragraph from the news is reproduced below
Quote
People privy to the development said that NBFCs under scrutiny are the ones set up by large family business groups primarily to cater to the debt needs of their group companies and related parties.
Unquote
Large companies not listed ? or Sun Pharma i think have nbfcâs but they surrounded the licensees
News is around 10 days back but important point in the news is Nandini Piramal now talking about PEL in the process of making a significant capital investment to ramp up capacities for formulation and active-pharmaceutical ingredients (APIs). âWe are making both greenfield and brownfield capital expenditure (capex). We are building both formulation and API blocks for our customers,â she said.
Looks like Piramal trying to get back into Pharma in a big way but they are about 1 year late. If they would have done this last year, they would have been ready for Pharma boom underway now.
Well put and I could not have agreed more.
I think PEL was drained by Financial Service and seems it consumed too much energy. They have been talking big plans for Phama for few years, but nothing much has happened other than recent PE player investment.
If they wanted, they could have acquired good companies in last 2/3 years when Pharam market was facing difficulty. Now they could be paying much highger prices for the same opportunities
I partly agree with what you said.
Piramal might be around a year late to expand their Pharma business esp since their NCC with Abbott got over in 2018(if Iâm not wrong). If they actually wanted to expand it again, Iâm sure theyâd have made plans before hand considering the businessman AP is. FS could be the sole reason for it, however Pharma division has made some small or big acquisitions over the years. If we think that Piramal is a year late and will have to splash out more money than a year before, then we also need to understand that we wouldnât have got such a valuation from Carlyle for a 20% stake. So net-net it might more or less be the same. Overall, itâd be good to see the Pharma division finally rise from here(better late than never) so that all the shareholders wealth is unlocked once they demerge in the coming years.
Piramal scouting for retail portfolio of DHFL
As per the latest presentation PEL has a war-chest of Rs 25,000 cr for acquisitions.
Here PEL go⌠Acquisition of 100% stake in one of the existing JV with Navin fluorine for 65cr.
