Indian Stock Market

Buy Venus Remedies – Pharma Sector – Small cap pick

About Venus Remedies:

Currently the stock is trading at Rs.265 per share. I expect the price to be in the range of Rs.350-400 in 1 year.

Chandigarh-based Venus Remedies is a major producer of oncological and cephalosporine injectable products. The company has de-risked its business model by having presence in the high growth therapeutic segments such as anti-infective, oncology, cardiology and neurology.

The company follows the strategy of forging marketing tie-ups with companies in India and abroad for specialty products. The company is also looking at contract manufacturing opportunities. It has filed many international patents for sophisticated formulations of anti-biotics and oncological therapeutics.

Last week, Venus launched world’s first once-a-day painkiller injectable in India. The company hopes to capture 10% market share in the early years of its launch and is already in talks with global pharma companies for out-licensing the product.

In March 2010, the company got Indian patent for one of its product Sulbactomax and has also filed patent for this product in another 50 countries including the US, Europe, Australia, Japan and Latin American countries.

Growth Strategy :

Registrations approved in 19 semi-regulated markets in 2008-09 are expected to drive the company’s prospects and profitability. Its launch of innovative products in India and other international geographies (through marketing alliances) will strengthen revenues.

Contract manufacturing opportunities with leading global brands are expected to yield attractive results. In-licensing initiatives are likely to reinforce our performance.

Financials :

The company’s net sales have grown at a compound annual growth rate (CAGR) of 55% over the past five years to Rs 310 crore in FY10. The net profits have grown at a CAGR of 62% to Rs 45 crore in FY10. The company has undergone a capex of Rs 200 crore over the past five years.

It has logged a strong performance for the first quarter ended March 2010. With 27% increase in net sales and 31% increase in net profit, the company has logged an improved performance sequentially.

Company Valuations:

The company has outperformed the Sensex and is currently valued at little over than its annual turnover. The stock is trading at a price-to-earnings multiple of 5.

These relatively lower valuations indicate the scope for the company’s stock to appreciate further as company continues to deliver growth. Investors looking at bottom-fishing in the small-cap space can consider this scrip.

Source: Economictimes.com

The US has entered 17th straight month of recession, but the pay package of its highest-paid CEO exceeds $100 million (over Rs 500 crore) — a figure more than 10 times that of his counterpart in the country of his birth, where economy is still growing at a decent rate. 

America’s top earning business head, mobile phone maker Motorola’s co-CEO Sanjay Jha, who got a package of $104 million in 2008, happens to be an India-born person. 

In comparison, India’s top-paid business chief, Mukesh Ambani of Reliance Industries, got a total remuneration of Rs 44.02 crore in 2007-08, the last fiscal year for which the salary data is available. 

Ambani’s package is just about one-fifth of the same for even Vikram Pandit, also and India-born person and CEO of banking behemoth Citigroup, which had to seek the US government’s support to keep running. 

Pandit is fourth highest-paid CEO in the US with $38.2 million (about Rs 200 crore) pay packet, while another Indian-born CEO at a US company, PepsiCo’s Indra Nooyi, is at the 36th slot with a pay package of $13.98 million (about Rs 70 crore). 

Pandit is also the highest paid CEO for bailed out banks in the US. 

The US economy shrank in the fourth quarter of 2008 by over six per cent — maximum fall in 26 years — and the economy is on a downward slope for 17 months now. 

In comparison, India is still maintaining a growth rate of about 7 per cent. While the growth rate projections for India has also declined from 9-10 per cent previously, the most pessimistic view also estimates a growth rate of 4-5 per cent to be maintained in the country. 

However, trends in the size of economy do not seem to be reflecting in the executive pay packages in the two countries. 

As per a survey conducted by Wall Street Journal, the overall CEO compensation at American firms has declined, but Motorola’s Jha still got a hefty package of $104 million in 2008, making him the top paid CEO in the country. 

In India, none of the business executives get paid even $10 million (Rs 50 crore), while there are just about two dozen people getting more than Rs 10 crore. 

These include RIL’s Mukesh Ambani, Sun TV Network’s Kalanithi Maran and Kavery Maran, Madras Cement’s P R Ramasubrahmanya Rajha, Reliance Communications’ Anil Ambani, Ranbaxy Labs’ Malvinder Mohan Singh, Bharti Airtel’s Sunil Mittal, Jindal Steel’s Naveen Jindal, JSW Steel’s Sajjan Jindal and Grasim Industries’ Kumar Mangalam Birla.

Source: Economic Times

Liquidity crunch, inventory piling up and re-scheduled export orders have taken the sheen off the auto component industry.

Provident Housing, a 100% subsidiary of Purvankara Projects, claims to have received 90 bookings for its ‘CosmoCity’ project in Chennai.

All forthcoming releases will come to a stall from April 4 onwards courtesy ongoing tussle between producers and the distributors on one side and the exhibitors (multiplexes) on other over revenue sharing for upcoming films.

A 16 night-17 day tour to Europe at Rs 1,71,577 per person, or roughly Rs 7 lakh for a family of four would hardly be considered an apt product to launch these days, but the Great India Tour Company based here is betting on continued splurging by outbound Indian tourists, craving for up-market destinations.

Drug major Ranbaxy Laboratories said it has received approval from Australian health regulator to market its anti-fungal tablets Serbifin Terbinafine in that country.

While world is poised to celebrate Women’s Day next Sunday, women still strive to find considerable senior management positions in privately held companies.

Mobile value-added services hold a tremendous revenue-generating potential in India which could rake in around Rs 18,000 crore by 2012, an official from state-run BSNL said.

Telecom operator Reliance Communications on Friday launched an international calling card for US and Canada – ICC 799 – which brings down call rates to these countries to Rs 1.99 per minute.

Leading two-wheeler maker Bajaj Auto has said the auto industry needs liquidity for its customers as ICICI Bank and other private lender have almost stopped giving auto loans due to restrictions on recovery of vehicles from defaulters.

Students passing out of colleges and universities this year should not be haunted by the spectre of wage cuts and job losses, instead focus more on developing skills as a value addition to their degrees to get placements.

Amidst rising unemployment, Britain is putting in place new immigration restrictions on professionals from India and other non-EU countries.

Japanese car major Honda will continue to cut its India output by over 45 per cent for the next six months in order to prevent inventory build up amidst the ongoing slowdown in the domestic market.

In 1928, Mexican film director Emilio “El Indio” Fernandez was approached by the art director of Metro Goldwyn Mayer, Cedric Gibbons, with a most unusual request.