CORPORATE FINANCE TABLE OF CONTENTS
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Added on 2020-02-14
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1 CORPORATE FINANCE TABLE OF CONTENTS INTRODUCTION 1 Business description1 Value to shareholders in recent history 2 Industry overview and competitive position2 Investment summary 3 Valuation including explanation of assumptions 3 Investment risks 5 CONCLUSION 6 REFERENCES 7 APPENDIX 9 INDEX OF TABLES Table 1: EVA analysis 9 Table 2: TSR analysis 9 Table 3: Calculation of terminal value 9 Table 4: Calculation of enterprise value 10 Table 5: Calculation of intrinsic value of share10 Table 6: Ratio analysis10 Table 7: Comparison of
CORPORATE FINANCE TABLE OF CONTENTS
Added on 2020-02-14
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CORPORATE FINANCE
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1Business description...............................................................................................................1Value to shareholders in recent history..................................................................................2Industry overview and competitive position..........................................................................2Investment summary..............................................................................................................3Valuation including explanation of assumptions...................................................................3Investment risks......................................................................................................................5CONCLUSION................................................................................................................................6REFERENCES................................................................................................................................7APPENDIX......................................................................................................................................9
INDEX OF TABLESTable 1: EVA analysis.....................................................................................................................9Table 2: TSR analysis......................................................................................................................9Table 3: Calculation of terminal value............................................................................................9Table 4: Calculation of enterprise value........................................................................................10Table 5: Calculation of intrinsic value of share.............................................................................10Table 6: Ratio analysis...................................................................................................................10Table 7: Comparison of firms on the basis of PE ratio..................................................................11Table 8: Comparison of the firms on the basis of PB ratio...........................................................11Table 9: Calculation of intrinsic value on the basis of EV/EBITDA method...............................12Table 10: Computation of NPV.....................................................................................................12
INTRODUCTIONSun pharma is the India largest pharmaceutical company and in order to understandconcept of equity valuation, mentioned firm is taken in the report. In the report, EVA and TSRanalysis is done and their results are explained in detail. Along with this, valuation methods likeDCF, PE, PB, EV/EBITDA and net present value is also mentioned in the report. Out of thesemethods best technique is identified for the share price valuation. Apart from this, assumptionsare used for conducting analysis in the report are also mentioned. At the end of the report,investment risks are pointed out and global and domestic economic environment are considered.Business descriptionSun pharma is a leading pharmaceutical company of India and it is the world fifth largestgeneric medicine manufacturer across the globe. Currently, it is operating in several nations andsupplying active pharmaceutical ingredients (API) to many large pharmaceutical corporations allover the world. Its inception is focused on research & development, developing API and genericmedicine and launching medicines in major therapeutic areas. It also brings large strategicchange in its distribution strategy by following front end model in largest pharmaceutical marketin the world that is USA. Due to this reason, it rapidly grows its business in the mentionedgeographic region. Time to time it is also entering into strategic partnership with the leadingpharmaceutical firms that are headquartered in the USA, UK and Japan. This is the big reasonbehind fast growth of the mentioned firm (Chaudhuri, 2005). Currently, it is producingmedicines related to various therapeutic areas like Oncology, respiratory and neurology etc.Recently, it acquires Ranbaxy which was also giant firm of India. Due to some mistakes in itsoperations, USFDA took strict action against the firm. After that, Ranbaxy was continuouslyfacing a lot of problems. In such a situation, Sun pharma decided to acquire Ranbaxy byfollowing a merger process. Regarding this, firm has completed all legal formalities and in FY2015 it completely acquired a giant firm. After acquisition, firm distribution network gotincreased and its product portfolio also enhanced (Kamath, 2008). After acquisition of Ranbaxy,firm became number one company in the generic dermatology space and many projects ofRanbaxy are in pipeline. Hence, it can be said that in future time period, firm will grow at a rapidpace across the globe.1| P a g e
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