Lincoln pharma is Ahmedabad based API mfg and Formulations Company.
Its recent Q2 performance is quite encouraging. Sales grew by 30+% and profit more than doubled to 7 Cr. Its new plant for injectables is the contributor for this growth. Hence expecting the same growth for next few quarters. Expected net profit for FY15 is >20 cr and MCAP is 140Cr trading at 7PE. I consider it as an opportunistic bet for now. Good performance in the next few quarters can re-rate the company to 10+PE .
What’s the source of this please?
Also, Promoters are continuously reducing stake.
Receivables are very high.
Any views on these two negatives?
Dear Sridhar,
Is there a reason why TV today has the maximum allocation in your portfolio? I hold it too but ensuring it stays below 10% because of the expected ruling of the courts on the 12 minute ad cap rule which is likely to affect profits.
@ Jatin - Here is the link for Lincoln developments -
Stake reduction is minute 0.14 % in 1 year. Receivables are increasing, it is reducing debt as well with available cash flows. That is one positive.
Anyway, Not much worried abt these negatives, as it is an opportunistic bet.
@ Abhishek - I am betting on digitization. Savvy investors like RK damani are invested in it. It is the best available media company trading at reasonable valuations.
If 12 min ruling happens, media companies can squeeze the same money with in 12 min as every product need air space too. Demand and Supply scenario.
Post your thoughts too.
Currently news channels are having ads anywhere between 18 and 20 minutes per hour. reduction by 50% in inventory would mean that they would have to double their ad rates. This is highly improbably and impractical. While prices will go up by a certain margin, profitability is most likely to be affected. In this scenario, while TV today will come out on top in the hindi news segment, there will be threat of substitutes in the form of GEC’s, etc.
There is no ruling for GEC channels?
My understanding is that most other channel genres are already operating within limits. Its news channels that are having largest ad inventories.
I might be wrong so request you to kindly do your own research.
Hi Sridhar,
It’s been so long and there is no update about your portfolio. After your post about kovai medicals, I’m silently following your views. Can you update your learning from 2014-2023?
