Piramal Healthcare: Will it live up to the expectations?

19 Jun

A lot has been written by experts(like Sanjay Bakshi and Deepak Shenoy) about the good management of the company and how the market has grossly undervalued the stock right now.
For those of you who aren’t familiar with the thing, given below is a quick summary:

  • The firm has given rich dividends and returns to its stakeholders in the past
  • The primary Business Unit of the firm was sold off , now the company has a cash reserve of about Rs 19,000 crores
  • The valuation of its shares is Rs. 540 per share(cash in hand)——-(Market Value of share at this time was–Rs. 450)
  • The firm has a really promising business model with the CRAMs sector predicted to grow at a comfortably high rate
  • It acquired IndiaReit Fund Advisors and IndiaReit Investment Managers for Rs 2.25 billion(Rs 225 Cr)–this decision drew a lot of flak from experts and sent its share prices plunging
  • Last  I heard Indiareit Fund Advisors was in talks to sell equity stake in its special economic zone (SEZ) in the western Indian city of Pune for Rs 5 billion
  • Piramal Life  Sciences has been merged with Piramal healthcare
  • Dividend of Rs.13 per share was declared
  • Currently the stock is trading at Rs.368.

I have already taken up a position in this firm and am waiting for positive cues to build it up further.


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