Neuro/Central Nervous System (CNS)
Market growth (IMS)
Lupin is growing very rapidly, and has captured a dominant position in many markets. The company has current assets of 51 billion rupees, more than enough to cover total liabilities of 36 billion. Goodwill represents only 5% of total assets, and the company has reduced total days AR outstanding from 91 in 2012 to 85 in 2013. Receivables grew by 23%, what is a health sign given the 34% jump in sales. Operating cash flow in 2013 stood at 12.5 billion INR, Capex of 5.5 billion INR results in a free cash flow of 7 billion INR and FCF yield of 7.5%.
The stock trades at a trailing P/E of 27, and P/S of around 4 and pays a small dividend of 0.43%. It has got quite a run behind it, but I still think it's reasonably priced given it's future prospects. I always recommend using a stop-loss when buying stocks at new highs. That way you cut losses very quickly when the markets turn, while still enjoying the high potential should the uptrend continue.