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Last Updated : May 09, 2011 01:55 PM IST | Source: CNBC-TV18

SP Tulsian view on Piramal Healthcare

In due course of time Piramal Healthcare will get settled at around Rs 300 per share, says Investment Advisor, SP Tulsian.


In due course of time Piramal Healthcare will get settled at around Rs 300 per share, says Investment Advisor, SP Tulsian.


Tulsian told CNBC-TV18, "Piramal Healthcare - I would say that this was just delayed technique on part of the promoters. They were never clear or they were intending to give that money back to shareholder, making a buyback of Rs 2000 crore against the sale consideration of Rs 17,000 crore does not justify."


He further added, "If you see the shareholder has invested into the company where the PE multiple available to these kind of companies are Rs 20. Now you are going into a business where the ruling PE multiple is not more than 10 because you have the established companies available into the infra financing and the NBFC space which are available at a PE multiple of Rs 10. So even if you have the same earning models available or earned on the surplus cash now left with the company you cannot really justify."


"There has to be the value destruction because first you destructed the value by selling 75% business of your company and mobbed up Rs 17000 crore, now you are not giving any money to the minority shareholders. Now you are going into the overall the PE multiple the business which are enjoying low PE multiple. I think maybe in due course of time share will see and will get settled at around Rs 300 per share. In fact this is just a forced imposition on the minority shareholder to remain invested in these companies."



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First Published on May 9, 2011 11:12 am
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