Orchid Pharma - New Management

Orchid Pharma is a pharmaceutical company engaged in the development and manufacture of active pharmaceutical ingredients (APIs) and finished dosage forms. It is also engaged in research of new drugs

Product Portfolio
The Co has a multi-therapeutic presence across segments like anti-infectives, anti-inflammatory, central nervous system (CNS), cardio vascular segment (CVS), nutraceuticals and other oral and sterile products. Its Product portfolio constitute of API - Cephalosporins - Orals, Cephalosporins - Injectables, Veterinary Products & Non-Antibiotics.

Geographical Split
India: 12 % in FY21 vs 9% in FY20
Rest of World: 88 % in FY21 vs 91% in FY20

Acquisition by Dhanuka Laboratories Ltd (DLL)
The Co was acquired by Dhanuka Laboratories Ltd under Corporate Insolvency Resolution Process and the plan was implemented in March 2020. It allotted 3.99 Crore equity shares to Dhanuka Laboratories Ltd for cash it also allotted 10,000 equity shares pursuant to the Scheme of Amalgamation to DLL.

Debt Settlement
The Co allocated 4,08,164 Equity Shares to the eligible Secured Financial Creditors for the conversion and settlement of part of their Debt.

General Notes

1. There is lot of buzz and activites in Orchid Pharma recently with promoters releasing pledge of shares which is positive sign
2. Co has reduced debt significantly because of debt settlement with bankers with haircut
3. EPS is subdued in negative but on consolidated basis they are looking good
4. Debt has been reduced to 50% from YOY and Reserves have turned positive from last 3 years
5. Other indicators such as debtors inventory ageing and payable days dont have much negativity. QOQ are running at the same pace.
6.There has lot of concalls and presentations by the co in recent times and with new management in hope to turnaround is looking to be trustable
7.This worth a buy at 330 for long term holding