More from jeevan patwa
I bought #Suven first in Apr 2013 around Rs 20…today after almost 7.5 years, its Rs 1000 (Suven pharma 920 adjusted for bonus + Suven Life 80)..CAGR of almost 68% for 7.5 years. I am fortunate to hold it throughout the journey and
add on multiple occasions on way up. Like to share my experience in this thread for everyone’s benefit..
First time I bought because I like the management focus on R&D. It had chosen the most difficult therapeutic area in pharma which is CNS and it was investing the cash
flow it used to earn from CRAMS. It also used to write off all the R&D expenses in the P&L instead of capitalizing it in BS. That gave me lot of comfort about management quality.
I kept on adding as funds keep coming. I remember giving a public presentation on Suven in
Mumbai at one analyst meet in Nov 2017 when it was trading at Rs 160. There was a huge call option embedded at that time in the form of SUVN-502. That would have been the blockbuster molecule if succeeded with market potential of $10 Bn plus..result was due in Dec 2019,
I loaded around 250-300 knowing the value of CRAMS business itself is more than 300.
SUVN-502 failed in phase-II trials, stock was down 15% from 300 to 250 in a single day, I added heavily. it was largest allocation in my portfolio because I knew the value of CRAMS business
Debt reduction – Ibulllreal will be debt free at the time of merger with 650 cr coming from Mr Gehlot and 580 crs from land sale to Elan group. Embassy will have 3000 crs debt out of which 1500 cr
will be reduced through QIP and rest 1500 crs will come from collections next year. So merged entity will be zero debt company in FY23
Sales potential – Launched + planned projects have 18000 cr sales potential with 3400 crs of near completed inventory. Pending cost is 3900 cr
and sold receivables is 4224 crs. That means 9900 crs of cashflow to come in next few years from these projects. In addition, it is holding land bank of 3353 acres and 350 acres (42.5 Mn) for commercial development with potential annual rental of 4300 crs.
JV/JDA/DM potential – With solid track record and backing of institutional investors, Embassy can acquire multiple large value projects under JV/JDA/DM model which enhance its RoCE. One such project is Embassy Bayview in Juhu with net surplus of 500 crs (quite big)..
Jazz Pharma was quoting around $0.5 in 2009, today its $150 and Mcap of $8.5 Bn on Nasdaq..almost 300x in 11 years. 80% of its total sales ($2.1 Bn) come from single drug Xyrem.
Axovant Lifescience, bought Alzheimer molecule from GSK, repackaged it and done phase-3 trials. Before starting the trials, the valuation was $2 Bn, just before announcing the data, it rose to $3 Bn. One of the leading broker put the target of $12 Bn if the trials succeeded..
but it failed in phase-3 trials. Current Mcap is $120 Mn…
This is R&D for New Chemical Entity (NCE)…very high risk and very high reward…
Brain-related illnesses, also known as CNS diseases, afflict more than 2 billion people worldwide. Diseases of the brain and mind range
from Alzheimer’s, dementia, epilepsy, migraine, multiple sclerosis, neuro infections, Parkinson’s, psychosis, schizophrenia and stroke to brain injuries and various mental disorders. The global market or CNS therapeutics is projected to reach $137.7 billion by 2025.
#SuvenLife has 1 lead molecule SUVN-G3031 in phase-2 trials which is similar to Xyrem but superior features, 3 molecules completed phase-1 trials and starting phase-2 trials and 11 molecules in pre-clinical trials. All are related to CNS which is growing and uncluttered market
More from Valuation
Some of my fav slides from the presentation.
✔️Misconceptions about and approaches to Valuation.
Can value investing strategies be improved by adding intangible assets?
👾 The Asset-Light Economy
🔮 The Dark Matter of Finance
🏰 Intangible Moats
📉 The Disruption of Value
👨🎓 Fixing the "Value Factor"
(Not investment advice)
(0/10) Full paper here 📘
(1/10) The Asset-Light Economy 👾
“The four largest companies today by market value do not need any net tangible assets. They are not like AT&T, GM, or Exxon Mobil, requiring lots of capital to produce earnings. We have become an asset-light economy."
- Warren Buffett
(2/10) The End of Accounting 🧮
“The constant rise in the importance of intangibles in companies’ performance and value creation, yet suppressed by accounting and reporting practices, renders financial information increasingly irrelevant.”
- Baruch Lev and Feng Gu
(3/10) The Dark Matter of Finance 🔮
While intangible matter holds the financial universe together, it is not visible to the naked eye. Unstructured data contains info on intangibles but is large, noisy, and resistant to standard statistical analysis.
All investors can do this with a handy tool: The Reverse DCF.
I'll also leave a download link to my compact DCF Model at the end of this thread.
2/ We all know a regular DCF. But's what a "Reverse DCF"?
If we consider that a DCF is a Linear Equation, we could say the 'X' (The unknown variable) is the Intrinsic Value.
In a Reverse DCF, we start with the Market Price and try to find some other variable, say Sales Growth.
3/ Let's start by taking an example: VST Industries, a Cigarette-maker based in India.
I valued them on my blog a while ago. I'll be retaining the old assumptions, but using the latest financials.
So please note that the Valuation isn't accurate
4/ This is a "Regular DCF" of VST Industries. The Assumptions I've made indicate an Overvaluation.
The Intrinsic Value is Rs. 3,012, but the Market Price is Rs. 3,492.
Let's not dwell on whether this is correct, since we discussed earlier that this isn't an accurate Valuation.
5/ If we want to do a "Reverse DCF" instead, we need to pick a different variable to 'find'. Say, I will pick the Sales Growth numbers.
I will now remove the Sales Growth numbers from the Model and assume that Sales Growth is the same across the years for ease of calculation.
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Hard pass. So long as Leader Pelosi remains the most progressive candidate for Speaker, she can count on my support.
I agree that our party should, and must, evolve our leadership.
But changed leadership should reflect an actual, evolved mission; namely, an increased commitment to the middle + working class electorate that put us here.
Otherwise it’s a just new figure with the same problems.
I hope that we can move swiftly to conclude this discussion about party positions, so that we can spend more time discussing party priorities: voting rights, healthcare, wages, climate change, housing, cannabis legalization, good jobs, etc.
These setups I found from the following 4 accounts:
Share for the benefit of everyone.
Here are the setups from @Pathik_Trader Sir first.
1. Open Drive (Intraday Setup explained)
Bactesting results of Open Drive
Already explained strategy of #opendrive— Pathik (@Pathik_Trader) May 27, 2020
Backtested results in 30 stocks and nifty, banknifty.
Success ratio : approx 40-45%
RR average 1:2
Entry as per strategy
Stoploss = Open level
Exit 3:15 PM Or SL
39 months 14 months -ve, 25 +ve
Yearly all 4 years +ve performance. pic.twitter.com/nGqhzMKGVy
2. Two Price Action setups to get good long side trade for intraday.
1. PDC Acts as Support
2. PDH Acts as
So today we will discuss two more price action setups to get good long side trade for intraday.— Pathik (@Pathik_Trader) June 20, 2020
1. PDC Acts as Support
2. PDH Acts as Support
Example of PDC/PDH Setup given
Simple and effective way 2 make Money
Idea 1:- Use pivot level like 14800 in case of nifty and sell 14800straddle monthly expiry (365+335) exit if nifty closes on daily basis below S1 or above R1
After closing below S1 if it closes above S1 next day or any day enter the same position again vice versa for R1
Idea2:- Use R1 and S1 corresponding strikes multiple
Incase of R1 15337 take 15300ce
N in case of S1 14221 use 14200pe
Sell both and hold till expiry or exit if nifty closes below S1 or above R1 around closing
If the same bounces above S1 and falls below R1 re-enfer same strikes
Use same criteria for nifty, usdinr and banknifty
(This is must)Use this margin rule for 1lot banknifty pair keep 4Lax margin
For nifty one lot keep 3Lax
For usdinr 100lots keep 4Lax
I bet you if you do this on consistent basis your ROI will be more than 70% on yearly basis.
Couldn't explain easier than this
Criticisms are most welcomed.
I have some thoughts:
As somebody who bootstrapped ~4 companies, I feel like I had to make some clearly suboptimal decisions early in them for lack of what is, in hindsight, not all that much money. But there's a huge gap in the product space for investment options.
It's weird: you can get $25k from Amex trivially, and angels are very willing to write a check for that much, but you have to make representations about your goals/ambitions/market/etc which don't really apply to everyone.
And so you see the traditional angel/VC ecosystem fund companies where honestly the returns are probably not there, and this is knowable pretty early, but the chase of them will wreck what could have been a perfectly happy business.
(To make the math work for traditional VCs the company has to at least have a market-appropriate shot of $100 million a year. There are a lot more $10 million a year companies than $100 million a year companies. That is *not* a bad terminal outcome for founders/employees.)