Year: 2008

It seems like Malvinder Singh’s uncle, Analjit Singh has a deep influence on the former when it runs to corporate and business practices. Ranbaxy, the dream company of late Dr.Parvinder Singh is likely to be sold to Daiichi. Singh family controls 34% stake in Ranbaxy Labs.

If you recall, Analjit Singh successfully ventured into Paging business in early 90s and sold it off at the peak to Hutchison by virtue of which he got stake in Hutchison India, later Hutchison Essar. Hutchison sold their stake at peak just last year to Vodafone. Analjit Singh made a killing by patiently holding on to his stake.

It is still not clear how Malvinder will handle group company stakes in Religare and Fortis Hospitals held by Rfanbaxy Labs.

Divis Labs Ltd (DLL) reported revenues of Rs2.8 bn. EBITDA margins at 41% were significantly higher and PAT was Rs 927 mn.

CRAMS and generics comprise around 50% of business. There were no one-time large orders registered this quarter. Thus, revenue line is likely to be maintained for the next few quarters.

Divis nutraceuticals plant which was commissioned in June 2008 and FY2009 will see the first year of revenues from this business.Sales is expected to grow by 48% and 40% in FY09 and FY10. Fully diluted EPS could be in the range of Rs 76 to Rs 80 for FY09.

The Edison Mission Group has withdrawn orders of 315 MW (second part of a two-phase 630 MW order) given to Suzlon Energy. This order withdrawal by Edison for 315 MW may affect near-term execution; Suzlon may however replace it by other orders in that geography.

Edison had the option of not purchasing the second part of the contract and it has exercised that option now. No explicit reasons are available for the exercise of the option by Edison. We believe Edison is a large customer of Suzlon (likely among the top 5 with Suzlon having executed (or executing) about 525 MW for this customer. This is significantly bad news for Suzlon Energy.