Stock Observation: Alembic Ltd
Alembic Ltd is the promoter company having a 29.18% (5.5 CR Shares) stake in Alembic Pharmaceuticals Ltd. Details on Link
The stake is valued at 12907 * 0.2918 = 3766.26CR
There was a dividend payout of nearly 24CR this Sept quarter to Alembic Ltd.
The bet here is on how well Alembic Pharmaceuticals will be doing after it got USFDA approvals to sell new drugs in US markets. It was visible in the Sept'15 results too. Good jump in the revenues and profits and the going looks great for the company.
So the value of investment which Alembic Ltd has done will be increasing going forward and a dividend income is also expected from Alembic Pharmaceuticals.
Checking the numbers on Alembic Ltd, it has no debt to start with. and even if one ignore the numbers which it posts, and it being only valued at the investment is still trading at a huge discount. I had given a holding company discount of 30% in case of BBTC too. Link
Value of stake after discount of 30% is 2636CR. Alembic Ltd being a Zero debt company should be given this value at-least and rest aside the business it does. Currently Alembic Ltd is valued at 1200CR MCAP, leaving a room for 119% appreciation for the valuations to catchup going by the current prices of Alembic Pharmaceuticals.
Few numbers from Screener
Technical views levels for Alembic Ltd (Monthly Charts)
The technical resistance comes at levels of 62. The fundamental targets can be met only once we get a monthly close above 62 levels.
New updates added:
The company has a 54% sales from its API business and 39% sales comes from the real estate business.
Company has 2 subsidaries: Alembic Pharmaceuticals Limited (29% stake held) & Alembic Exports Limited (45% stake held).
The core business for Alembic Ltd is to produce a product - Lovastatin.
The company is in a real-estate business too, - Weblink - http://www.alchemyindia.com/
The Company has completed its maiden real estate project
–“Samsara” well within time and is in the process of starting
a new project in the same vicinity at Vadodara.
Company has a investments amounting to 31+ Cr in reliance mutual fund schemes,
Annual report link
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