Description
Analysis of Panacea Biotech
Panacea Biotec
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There are 5 pentavalent vaccine manufacturers in India – Crucell NV, Glaxo Smith Kline, Panacea Bioctec and Sanofis Shantha Biotec.
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The company has a strong product pipeline. But there is always a risk of products not getting approvals from the drug regulators.
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Debt Capacity - Interest/ CFO average over 8 years in 32.40% and is increasing over the years (currently at 62%). D/E ratio has been increasing over the years – 1 (2010) 0.91 (2009) 0.56 (2008) FCCB - Panacea has FCCBs worth US$36.8 mn (Rs 1,652 mn). Conversion price of Rs357.6/share, which is significantly out of the money with the current market price of Rs 193. The FCCBs are due to be redeemed in February 2011. The company plans to raise debt to finance the redemption. Total Debt of the company (assuming FCCB will be financed through debt) by FY11 will be – Rs. 828.55 Cr Buy-Back - Company has bought back 55.92 Lakh equity shares for 109.82 Cr. Rs. This is 85.76% of the maximum buyback offer size of 128.05Cr. Rs. The buy-back is at maximum Rs 229 per share. Forex losses - Unrealized forex losses for the company stood at 1,68.9 Cr Rs. in 2008-09 which adversely effected their Cash from operations. The company has now made amends to its hedging policy, the company now limits its exposures to 60% of imports and does not take positions for more than 6months, with a weekly review of the same. Cashflow – The company has been raising cash through financing to finance the investment in R&D and Capex. Subsidiaries - The company has been raising substantial investments in subsidiaries and raising loans in its subsidiaries over the years. Subsidiaries - Best On Health Limited, Umkal Medical Institute Pvt. Ltd., Panacea Biotec Inc., Panacea Biotec FZE, Rees Investments Limited JV - Chiron Panacea Vaccines Pvt. Ltd, PanEra Biotec Private Limited
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doc_771792240.pdf
Analysis of Panacea Biotech
Panacea Biotec
2
There are 5 pentavalent vaccine manufacturers in India – Crucell NV, Glaxo Smith Kline, Panacea Bioctec and Sanofis Shantha Biotec.
3
The company has a strong product pipeline. But there is always a risk of products not getting approvals from the drug regulators.
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Debt Capacity - Interest/ CFO average over 8 years in 32.40% and is increasing over the years (currently at 62%). D/E ratio has been increasing over the years – 1 (2010) 0.91 (2009) 0.56 (2008) FCCB - Panacea has FCCBs worth US$36.8 mn (Rs 1,652 mn). Conversion price of Rs357.6/share, which is significantly out of the money with the current market price of Rs 193. The FCCBs are due to be redeemed in February 2011. The company plans to raise debt to finance the redemption. Total Debt of the company (assuming FCCB will be financed through debt) by FY11 will be – Rs. 828.55 Cr Buy-Back - Company has bought back 55.92 Lakh equity shares for 109.82 Cr. Rs. This is 85.76% of the maximum buyback offer size of 128.05Cr. Rs. The buy-back is at maximum Rs 229 per share. Forex losses - Unrealized forex losses for the company stood at 1,68.9 Cr Rs. in 2008-09 which adversely effected their Cash from operations. The company has now made amends to its hedging policy, the company now limits its exposures to 60% of imports and does not take positions for more than 6months, with a weekly review of the same. Cashflow – The company has been raising cash through financing to finance the investment in R&D and Capex. Subsidiaries - The company has been raising substantial investments in subsidiaries and raising loans in its subsidiaries over the years. Subsidiaries - Best On Health Limited, Umkal Medical Institute Pvt. Ltd., Panacea Biotec Inc., Panacea Biotec FZE, Rees Investments Limited JV - Chiron Panacea Vaccines Pvt. Ltd, PanEra Biotec Private Limited
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doc_771792240.pdf