Sunday, 8 March 2015

Interesting Stock To Watch

Zenotech Laboratories
BSE:532039
CMP: 31.20
This small company with a market cap of under 100 crores is looking like a "NOTHING" till today, It has losses it has debt and it has closed its manufacturing unit.
But the point here is: This company is owned by Ranbaxy Laboratories and Daichii Sankyo.
Ranbaxy holds 46.84%, Daiichi Sankyo holds 20% that is 66.84% promoter holding. Its ex-promoters (Chigurupati family) from whom Daiichi had acquired the shares is still holding more than 20% stake.
Which means a total of 86.84% is with ex and present promoters.

Now with the Sun Pharma - Ranbaxy deal, Sun Pharma becomes the owner of this small company and it also made a mandatory open offer last year to acquire Daiichi Sankyo's 20%+ in Zenotech at Rs 18 per share but now the open offer price has to be changed according to SEBI regulations.

Years back, Chigurupati did not want to sell his shares under 160 rs per share and yet Daiichi managed to acquire the company but till date the issue is sub judice and the case is going on.

I think it is mandatory for Sun Pharma to make the open offer and acquire the company fully. Via Ranbaxy, Sun Pharma already owns 46.84% and by buying additional it will further increase Sun Pharma's holding in Zenotech.

Now what about the future? Either, Sun Pharma can buy Chigurupati's stake too and delist the company or else Sun Pharma may start the operations for this company, In any case Chigurupati will not be easy to deal with as his earlier case against Daiichi is still stretched up.

I think Sun Pharma after gaining full control over Zenotech will start the business but this is a pure assumption, Company is not in good health.

Sun Pharma is on a acquisition drive, Last week it has purchased opiates manufacturing unit of Glaxo in Australia and i assume that Sun Pharma should do something with the Zenotech manufacturing units too.

Recently shares of another shut down company KREBS BIO rallied from 30s in Feb 2015 to almost 100 now after being taken over by IPCA Laboratories via open market and open offer route.

24 comments:

  1. top class, anonymous story broken sir

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  2. This is a great find!!!

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  3. sir your view on THOMAS COOK, TCI and GODREJ PROPERTIES

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  4. Sir,

    Your view on mic electronics and lincolin pharma

    Thanks

    Amudhan

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    Replies
    1. Not tracking stocks in above two comments.

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  5. prem why your all recommendation are falling so heavily....and wht u think about richa ind...please publish your reply

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    1. The stocks rallied "Heavily" too but you where not posting comments.

      Anyway as for Richa there is no fundamental change after last update so i cannot reply on a daily basis, If there is an update it is pushed to the blog effectively.

      Delete
  6. good to see you back prem sir.

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  7. Sir,

    Your view on sharon bio medicine after getting approval from UKMHRA. can i buy at CMP Rs.22.05

    Thanks

    Amudhan

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  8. Hello PRem Sir ...

    gd to C U back with BANG BANG of ZENOTECH n by luck \ grace of GOD I manage to get 1000@32 n it luks like ,,,it dnt stop till 50-60 easily ,,, mny mny thansk to U SIR


    whn will I\We see ur nxt pick ...... also holds PARNAX as delivery with no panic

    SACHIT

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  9. Hello Prem G .... pl update in PARNAX as I hold it from 44 (1000 shares ) ,

    nything U know abt SMS PHARMA n UNITED DRILL ,,, so pl share ur kind view

    Sir can we have ur nxt call in near future if it is possible

    what is uyour in NIFTY as FED meet is on card








    RAVI CHANDRAN

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  10. Missed this pick ...daily UC ... Tried everyday but could not get hold of any shares ... Kept money for next pick ,please let us know when it is :-)

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  11. sir share your views on Welspun Projects & welspun ent Merger news
    http://www.moneycontrol.com/video/business/merged-welspun-proj-to-be-profitablefy15-md-garg_1219942.html

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    Replies
    1. Sorry i am not tracking both the companies

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  12. Hi ACE,

    Please if you could help me understand :" On what basis the stock price of Orient Bell is trading higher than Asian Granito's price? I understand the demand and supply theory of the market but this valuation gap has been continuing since very long time and we know markets discover the fair price in long term. But the long term has already passed and Asian Granito is a much better stock than Orient Bell in all parameters including future growth. I believe that the differential is almost 100% if you compare the statistics. Please help the investors understand the value in Asian Granito.

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    Replies
    1. Though not tracking both the companies i googled a bit right now.

      Maybe Orient bell has more brand value than Asian Granito.

      I agree with you, Orient bell has a net profit margin of 0.34% and for Asian Granito it is around 1.86%.

      Orient bell is clearly over-valued at current levels, I don't know exactly why but if there is a correction in market always remember the over valued nose dives with panic selling while the undervalued will be accumulated on all dips.

      Delete
    2. To add, I feel rather than AG being under valued it is more about OB being over-valued.

      Don't expect AG to trade at such silly astronomical valuations.

      Delete
  13. Please guide on the long term prospects of Orient Green Power Company.

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  14. Prem, what is your view on Lycos Internet?

    ReplyDelete