Conviction | Patience's Threads

MCap is a function of market sentiments. Balance sheet, cash flows, R&D execution, talent acquisition, regulatory compliance, M&As and so on....are a function of management/governance. Never mix the business with the stock. Stock is not the business. Business is not the stock :)

It's simple, if ""FY23 PAT of this API to CDMO = FY21 PAT of largest pure-play CDMO/API"" then the FY23 Mcap of this API/CDMO= FY21 Mcap of largest pure-play CDMO/API, am I correct Sajal saab??
— richman (@greatrichman3) June 14, 2021

Sajal Kapoor
@unseenvalue

Before recording this webinar, used Brinzolamide API to improve vision 👁️

Keywords :: Brinzolamide API vision

"I see Reliance also moving in the clean energy space.":)
3:30:43 onwards @unseenvalue https://t.co/d7irthqo6q
— Intrinsic Compounding (@soicfinance) July 2, 2021

Sajal Kapoor
@unseenvalue

@rwind78 @sahil_vi @AdityaKhemka5 @soicfinance #SeQuent is investing in enhancing the terminal value of the business. This should provide better valuations fresh entry next year. Given the fact that it was 40+ in 2018, even a 400+ by 2028 would mean a very healthy 25-26% CAGR ex dividends.

D: Invested. Add more next year.

Sajal Kapoor
@unseenvalue

Conviction | Patience

Asian Paints is the TCS of 'Home Improvement' space

Think in terms of ::

- Sustainability of Leadership over decades
- Sustainability of Consumption Megatrend
- Sustainability of CFO and Governance
- Quality of Balance Sheet

Rather than absolute MCap

Conviction | Patience

TCS of CDMO in the making over the next 15Y \U0001f1ee\U0001f1f3

Compounding @ 25% since the IPO.

Syngene | Revisit 2030-2040 https://t.co/PHd8UEod5X
— Sajal Kapoor (@unseenvalue) December 30, 2019

Sajal Kapoor
@unseenvalue

There's more to disclose!

Waiting for business to perform before i share more as too much talking is deemed 'pump and dump' by the elite Twitter activists (who have to pay their advisory staff's salary and bills - so free knowledge sharing hurts their interests)

#Biotechnology

@unseenvalue mentioned this in his seminar https://t.co/kGS9jHuBYx
— Sishya of Highly Respected Sunaka (@JpackJack) June 19, 2021

Sajal Kapoor
@unseenvalue

I did share this interview back in January. Reiterate my high conviction on #CDMO #APIs despite negative chatter and several obituaries 🥱

Exactly the reason we (including @punitbansal14) were bearish on players with heavy dependency on formulations

Sajal Kapoor
@unseenvalue

@pushkat @LaurusLabs I don’t deserve any credit. It was your hard earned capital. You took the risk.

Business has performed due to best in class management, capabilities, capacities, patents and scientific talent that Laurus has accumulated over the years. Best is ahead 🤞🤞

Conviction | Patience
@unseenvalue

Affordable and Accessible research and innovation in an unseen olympics where many Indian companies win 🥇 and make the country proud. US enterprises are way ahead in cutting-edge Lab R&D, but they come to 🇮🇳 for scale-up and affordable manufacturing (CDMO model).

Go 🇮🇳 Go 👏👏

Watch the journey of\xa0Insulin Glargine's landmark USFDA approval for first interchangeable #biosimilar for the treatment of diabetes, a testament to #BioconBiologics' scientific excellence & robust quality comparibility data. https://t.co/JSM4LPqYdh
— Biocon (@Bioconlimited) August 1, 2021

Conviction | Patience
@unseenvalue

@shuchi_nahar @AnyBodyCanFly Created this thread in 2018, as saw this coming. Covid actually accelerated the trend … next disruption will be lead by biosciences. Unseen today be seen few years out

Technology is enabling new ways of credibly accessing medical knowledge via smart phones / tablets.

Android, iOS have > 5k health / fitness apps like @Medscape, pointing to a future where the Tech. drives a part of medical knowledge and therapeutic guidance instead of a Doctor!
— Conviction | Patience (@unseenvalue) November 8, 2018

Sajal Kapoor
@unseenvalue

Avoid low quality assets in a sector where price discovery has been relentless over many years. Stay with tier 1 players. Margin of safety is in business first and not the entry price. This is not valid for short term positional trades. Those are managed via strict stop losses.

Speciality vs Commodity Chemicals

Speciality - typically bespoke solutions as per customer's requirements. High complexity. This makes continous R&D and product innovation a key success factor!

Go to 2 hr 21 mins for my views on #Chemicals sector \U0001f447https://t.co/Zzx6AwHZLH
— Sajal Kapoor (@unseenvalue) June 15, 2020

Sajal Kapoor
@unseenvalue

@suru27 The number of pets that we spot while morning and evening walks have noticeably increased over the last few months. These companions are great in emotional support, and a natural therapy for 🧠

Conviction | Patience
@unseenvalue

When we put a high multiple to sales, the most important thing to worry about is - what could disrupt those cash flows. A lower multiple to sales (like a 1x or 2x) justifies Yo-Yo cyclicality and 10x sales implies relatively stable gross margins, cash flow and business economics.

It's amazing \U0001f60a 25% NP

$8b revenue
$2b Profit
$92b MCap

At 11 times revenue, it seems to be cheap compared to\U0001f609
— Avinash (@Aviral_Bharat) February 17, 2022

Sajal Kapoor
@unseenvalue

Research in CDMO/APIs is never a slam dunk. It may take ages to yield results. CEP filings can be lumpy as a result. As I wrote last year (link below), Hikal has been consistently sacrificing operating profits for a sustainable future. Best is ahead 🎥 🍿

https://t.co/hItmOud8Pm

#Hikal has stepped up R&D in recent years. Next few years (capex & launches) should yield superior earnings. Wish them all the luck \U0001f44d

D: invested and biased view for sure, but it was below 1x price to sales vs 12x price to sales for many chemicals and generic players. No reco!! pic.twitter.com/aqPUKbziHK
— Sajal Kapoor (@unseenvalue) September 26, 2020

Sajal Kapoor
@unseenvalue

18-19% ROE wale being bought by institutions at anywhere b/w 12 and 20x price to sales. Not many liked this space in 2013. Not many hate it today. Social validation in investing is a big curse ...

Ghor ChemYug 😆

#DeepakNitrite valuation is most attractive in the space...

growth will be most explosive in the space... pic.twitter.com/8VYdWwFApY
— jeevan patwa (@jeevanpatwa) June 30, 2021

Sajal Kapoor
@unseenvalue

@BhavaniprasadP Listen to @AdityaKhemka5

Authors Conviction | Patience