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FE Investor Bureau
NEW DELHI, Aug 6: The market has cheered the first-quarter performance from Bausch & Lomb. As the company's impressive performance is a clear sign of sustaining the turnaround made in the last fiscal, the Bausch & Lomb counter on BSE is attracting a lot of buying interest.
In the past nine trading sessions, the stock has zoomed by 46 per cent to Rs 120 which is also the same level touched by the scrip in May on an impressive turnaround during fiscal 1998. The spurt in both prices and volumes at this counter is mainly on the hope that the company will be able to wipe out its accumulated losses to the tune of Rs 15.86 crore.
The company has reported almost 55 per cent jump in net profit to Rs 3.79 crore against the Rs 2.45 crore in the first quarter of fiscal 1998. Total sales saw a 33 per cent jump to Rs 25.15 crore against Rs 18.92 crore in the previous first quarter. Besides the 33 per cent growth in sales, the spurt in net profit is also supported by a substantial rise in other income from Rs 6 lakh to NEW DELHI, Aug 6: The market has cheered the first-quarter performance from Bausch & Lomb. As the company's impressive performance is a clear sign of sustaining the turnaround made in the last fiscal, the Bausch & Lomb counter on BSE is attracting a lot of buying interest.
In the past nine trading sessions, the stock has zoomed by 46 per cent to Rs 120 which is also the same level touched by the scrip in May on an impressive turnaround during fiscal 1998. The spurt in both prices and volumes at this counter is mainly on the hope that the company will be able to wipe out its accumulated losses to the tune of Rs 15.86 crore.
The company has reported almost 55 per cent jump in net profit to Rs 3.79 crore against the Rs 2.45 crore in the first quarter of fiscal 1998. Total sales saw a 33 per cent jump to Rs 25.15 crore against Rs 18.92 crore in the previous first quarter. Besides the 33 per cent growth in sales, the spurt in net profit is also supported by a substantial rise in other income from Rs 6 lakh toRs 25 lakh.
On an expanded equity base of Rs 24 crore (post-rights), the annualised EPS works out to Rs 6.31. The EPS of Rs 6.31 discounts the current market price of Rs 120 by a multiple of 19.
The company had managed a turnaround by posting a net profit growth of 950 per cent to Rs 5.35 crore for fiscal 1997-98. The company has recorded a sales growth of 18.14 per cent to Rs 66.34 crore and net profit saw a whopping 9.5 times jump to Rs 5.35 crore from Rs 51 lakh.
The company had reduced its accumulated losses from Rs 21.04 crore to the current level Rs 15.86 crore. The reserves (including revaluation reserves) have increased to Rs 42.85 crore for 1997-98 from Rs 16.09 crore for 1996-97 on account of a Rs 26.81-crore rise in share premium account, thanks to the rights issue. The company has also not declared any dividend to boost its reserves.
The company had managed a turnaround in fiscal 1998 mainly due to a higher sales growth, saving on interest cost and better expenditure management.
Theinterest cost had fallen to Rs 2.65 crore from Rs 3.32 crore. The company had paid back a portion of its high cost debt to the tune of Rs 21.21 crore, which was one of the prime objectives of its rights issue.
Its dependence on high cost short-term money has been reduced by Rs 13.04 crore as the company had earmarked Rs 13 crore for working capital requirements from the rights issue proceeds.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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