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Maintain growth guidance: Management indicated that hospitals in EU/US are
not cutting spending on vital equipment, though some big-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 resumed selling in Japan through Omron –
management said it would take two 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 and coating it. 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 three 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 �� ��
Maintain growth guidance: Management indicated that hospitals in EU/US are
not cutting spending on vital equipment, though some big-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 resumed selling in Japan through Omron –
management said it would take two 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 and coating it. 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 three 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.
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