Visit http://indiaer.blogspot.com/ for complete details Valuation of Pirmal Healthcare by Emkay
Fair Value arrived at is Rs 664
Piramal Healthcare has announced buy-back of 20% equity (41.8mn share) @Rs600 per
share which entails a cash outflow of Rs25.08bn. Promoters will tender the share in
proportionate thus limiting the acceptance ratio at 20% level. Piramal has received upfront
cash of Rs105.3bn from Abbott and Super Religare (Rs3bn), out of which company has
paid Rs35.7bn as tax, Rs3.5bn as non-competing fees to promoters and Rs6.5bn as debt.
Adjusting to cash outflow on buy-back, company will have net cash of Rs34.5bn
(Rs206/share on 167.2mn shares). This amount will be used to fund the growth of existing
businesses (US$45-50mn annual capex) as well as to scout for opportunities in other
sectors. The cash per share of future cash works out to be Rs347 per share, taking total
cash value per share to Rs554 on reduced equity. Value per share of residual business on
FY10 numbers is Rs110 per share. This takes the fair value of Piramal Healthcare to Rs664
per share.
share which entails a cash outflow of Rs25.08bn. Promoters will tender the share in
proportionate thus limiting the acceptance ratio at 20% level. Piramal has received upfront
cash of Rs105.3bn from Abbott and Super Religare (Rs3bn), out of which company has
paid Rs35.7bn as tax, Rs3.5bn as non-competing fees to promoters and Rs6.5bn as debt.
Adjusting to cash outflow on buy-back, company will have net cash of Rs34.5bn
(Rs206/share on 167.2mn shares). This amount will be used to fund the growth of existing
businesses (US$45-50mn annual capex) as well as to scout for opportunities in other
sectors. The cash per share of future cash works out to be Rs347 per share, taking total
cash value per share to Rs554 on reduced equity. Value per share of residual business on
FY10 numbers is Rs110 per share. This takes the fair value of Piramal Healthcare to Rs664
per share.
No comments:
Post a Comment