Mar 28, 2012, 11.04 AM | Source: CNBC-TV18
Zydus Wellness can touch Rs 500, says SP Tulsian, sptulsian.com.
SP Tulsian (more)
CEO, sptulsian.com | Capital Expertise: Equity - Fundamental ,IPO
Tulsian told CNBC-TV18, "Zydus Wellness is a Zydus Cadila Group company and they are into the health and life-care segment. They are making sugar-Free, which is their main product. The share price has in fact corrected maybe in last three months or so. It used to rule at about more than Rs 500."
He further added, " Cadila Healthcare is holding 70-72.50% stake in the company and 18% are with the institutions, 10% with the public float and the financial performance also has been quite robust. The first nine months topline of Rs 250 crore with EPS of close to about Rs 12 and the company has been very prudent in initiating their marketing moves and all that because it is a debt-free company."
"You are sitting on a cash of about Rs 100-110 crore as on December 31. So that cash is largely used to promote or to introduce and to accelerate the presence of the brand or to grab the market share which they have been doing very smartly over the last couple of years and I think the same trend is likely to continue."
"FY13 in fact I am expecting that company should be able to post an EPS of close to 80 and if you see the stock, which traditionally used to enjoy the P/E multiple of more than 20 because of its unique product portfolio, the unique
profit margins and all sort of things, I think the stock has very limited downside from hereon since it has already been corrected in last three months or so and if someone can keep a view of about 6-8 months, they can expect a price of about Rs 500."
Disclosure: No holding or interests in the above stock.