Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
We recently hosted Opto Circuits at the J.P. Morgan India SMID Corporate
Access Day. Management maintained that growth remains on track with invasive
business growing at 30% and non-invasive at 20%-25%. Cardiac Science
turnaround is on track and management expects it to deliver ‘mid-teen’ margins.
OPTC is consolidating its manufacturing operations to three key locations in US,
Malaysia and India, which will help operating margins. Working capital levels
for FY11 seem elevated as revenues for three acquisitions made in FY11 are
consolidated only for part of the year.
Maintain growth guidance: Management indicated that hospitals in EU/US
are not cutting spending on vital equipment, though some large ticket capex
plans have been curtailed. OPTC is prepared for any potential slowdown; it had
faced pricing pressure in the US in 2008, but had managed to sustain margins
by clubbing consumables and equipment sales. While discounts were offered
on the equipment, Opto was able to price consumables at higher levels.
Cardiac science turnaround: Management guided to 10% revenue growth
with ‘mid-teen’ margins for CY12. CSX has resumed selling in Japan through
Omron – management indicated it will take 2 years for CSX to scale up to its
historic levels.
Tie up with Mycell for stents: OPTC has tied up with Mycell - stent coating
specialist that is using Opto’s bare metal stents for coating. Mycell is currently
undertaking clinical trials for CE certification and would file for USFDA
approval post CE approvals. OPTC could reconsider carrying out clinical trials
for the US on their own, and may potentially use the Mycell tie up as a route to
gain entry into the US invasive product market.
Consolidation of manufacturing operations: OPTC is consolidating its
operations in US and are phasing out the Rhode Island plant in US and shifting
production to Wisconsin, Malaysia and Vizag. It is also looking to move
backend R&D to Malaysia and India, which should help boost margins.
Working Capital concerns overdone: Working capital levels in FY11 look
elevated as revenues for 3 acquisitions made during last year are consolidated
only for part of the year. Adjusted working levels are closer to 100 days (vs.
140 days as per FY11 balance sheet). Management expects receivable days to
improve going forward as it enters more contracts with GPs.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
We recently hosted Opto Circuits at the J.P. Morgan India SMID Corporate
Access Day. Management maintained that growth remains on track with invasive
business growing at 30% and non-invasive at 20%-25%. Cardiac Science
turnaround is on track and management expects it to deliver ‘mid-teen’ margins.
OPTC is consolidating its manufacturing operations to three key locations in US,
Malaysia and India, which will help operating margins. Working capital levels
for FY11 seem elevated as revenues for three acquisitions made in FY11 are
consolidated only for part of the year.
Maintain growth guidance: Management indicated that hospitals in EU/US
are not cutting spending on vital equipment, though some large ticket capex
plans have been curtailed. OPTC is prepared for any potential slowdown; it had
faced pricing pressure in the US in 2008, but had managed to sustain margins
by clubbing consumables and equipment sales. While discounts were offered
on the equipment, Opto was able to price consumables at higher levels.
Cardiac science turnaround: Management guided to 10% revenue growth
with ‘mid-teen’ margins for CY12. CSX has resumed selling in Japan through
Omron – management indicated it will take 2 years for CSX to scale up to its
historic levels.
Tie up with Mycell for stents: OPTC has tied up with Mycell - stent coating
specialist that is using Opto’s bare metal stents for coating. Mycell is currently
undertaking clinical trials for CE certification and would file for USFDA
approval post CE approvals. OPTC could reconsider carrying out clinical trials
for the US on their own, and may potentially use the Mycell tie up as a route to
gain entry into the US invasive product market.
Consolidation of manufacturing operations: OPTC is consolidating its
operations in US and are phasing out the Rhode Island plant in US and shifting
production to Wisconsin, Malaysia and Vizag. It is also looking to move
backend R&D to Malaysia and India, which should help boost margins.
Working Capital concerns overdone: Working capital levels in FY11 look
elevated as revenues for 3 acquisitions made during last year are consolidated
only for part of the year. Adjusted working levels are closer to 100 days (vs.
140 days as per FY11 balance sheet). Management expects receivable days to
improve going forward as it enters more contracts with GPs.
No comments:
Post a Comment