Discover and read the best of Twitter Threads about #divis

Most recents (8)

Divis has been a compounding machine for the past 10 years. But the stock has corrected almost 50% from its all-time high.
In todayโ€™s thread, let us understand what are the reasons for this massive fall.

Like and retweet for maximum reach.
#Divis #DivisLabs #Pharma
This is the third time the stock has corrected by 50%, the last two times were during the 2008 financial crisis and in 2017 when they had received an import alert at their manufacturing facility. Divis went on to create massive wealth from there.
The first reason is the decline in sales for Molnupiravir. Molnupiravir is a Covid drug by Merck that can be administered orally. The company had given voluntary licenses to a lot of formulation companies that wanted to manufacture the drug.
Read 12 tweets
Insights on the Indian API, Formulation and CRAMS via a recent report from o3 Capital.

Tailwinds (China+1): 10% market share switch from China can double Indian API market.

Headwinds: Rising input costs in China due to power outage + freight hike. India has high dependency.
Indian API landscape

Scale, capacity, DMF filings, focus segments/ therapy areas and leading products.

#Divis #LaurusLabs #Granules #AartiDrugs #Solara
Growth strategies adopted by API companies

- Diversifying beyond API and CRAMS into Formulations, Biologics and Nutraceuticals.

- Laurus: Forward integrated into drug development via contracts from NATCO, Citron, Dr. Reddy + foray into new markets + new segments (Biologics)
Read 8 tweets
A Thread on #Laurus Labs as Promised
#Technicals - To time the entry and Price
Laurus Labs Currently near Support zones .
620 in my view is a strong support
Showing Buying Volumes since yesterday ! Image

Laurus labs is into API , Formulations , Bio Synthesis and CDMO Bussiness

API Bussiness leader #Divis Labs - Only API . No formulations - PE Rating 66
Lowest Cost producer

#Laurus Labs - Into API and formulations . One among the lowest cost producer
Current PE - 33 Price 662 .

#Syngene - CRAMS and CDMO - Means mostly does work for other Multinational Companies . PE Rating 62

#Sun Pharma - Formulation Major - PE 33

Now looking at the others and #Laurus Labs there are some outstanding Numbers to see
Read 11 tweets
Mega ๐Ÿงต on Tatva Chintan.

What excites me. What is the biz. What am i gonna do about the co.

Now that company is listed with around ๐Ÿ’ฏ%+ gains, probably a good time to understand #tatvachintan

Letโ€™s dive right in. Image

First let us understand the types of products the company makes. This is a chemicals company. The primary line of products they are into is called PTC: Phase transfer agents. Before I explain what that is, let us do a small dive into chemistry.
The basic building blocks of matter (everything around you) are atoms. They come in 118 flavors, called elements. The water you drive is made of 2 Hydrogen atoms & 1 Oxygen atom: H2O. Image
Read 36 tweets
๐Ÿ‘‰๐ŸฟWhy I believe this #multibagger #Lauruslabs can be a 4 digit stock from here on

โžก๏ธShort //Thread\\

In Q4 FY21:

โœ…Formulations revenue grew 60.9% YoY to Rs. 430 crore
โœ…CRAMS business grew 19.0% YoY to Rs. 176 crore.
โœ…EBITDA margins improved 1059 bps to 33.4%

~ #Laurus has planned a capex of Rs. 2400 Cr in next 36 months through internal accruals.
~As per mgm guidance it will have a sales of over 7000 cr in FY23.
~With healthy margins & RoCE of 35%+ we can assume Profits upwards of Rs. 1450 Cr which gives a FY23 EPS >Rs. 27

Moderating its Growth from 40%+ in the past to a more reasonable 30% in FY24 will take its sales over Rs. 9000+ Cr.
With healthy FCF & 35%+ RoCE (1.3/1.4 times of asset turn x 28%+ EBIDTA) it will generate profits in upwards of Rs. 1950 cr. giving it an FY24 EPS of Rs.36+

Read 4 tweets
Below are few gems in #Indianpharma spaceโ€ฆI own #Lauruslabs #Suvenpharma and #Suvenlife..

#Suvenpharma โ€“ NCE CRAMS โ€“ top end segment in CRAMs
#Suvenlife โ€“ Pure play CNS R&D โ€“ CNS is most difficult but largest market share in pharma
#Lauruslabs โ€“ process Innovation

#Biocon โ€“ Biosimilars โ€“ largest portfolio of biosimilars among Indian peers
#Syngene โ€“ Biologics CRAMs
#Divis โ€“ Execution capabilities
#Gland โ€“ Regulatory capabilities
#Natco โ€“ Para iV opportunities
#Sequent โ€“ Animal APIs

#Cipla โ€“ Strong respiratory franchise โ€“ should play out in next two years
#DRL โ€“ complex generics โ€“ should play out in next 2 years

Read 3 tweets
#TweetStorm - Expensive or deserves to be Expensive ? 1)One thumb rule for screening expensive companies is Market Cap to Sales or Enterprise Value to Sales. A 10x or more is generally expensive unless the company can grow sales rapidly or has extremely high Net Profit Margins.
2)Another way to look at expensive is if the Market Cap is equal to the Total Sales of the Addressable Market Size. This would lead to company having to launch different products in the future.
3)May not be the approach to take a Sell Decision or a Short Sell Decision. Very few companies can command such high valuations. Thumb Rule is just to review the investment thesis and the quality of the business. If doubts on quality , get out.
Read 9 tweets

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