Hot chips - UTV Software & Lupin

Ali On Content / 31 Jan 2011

DSIJ's analysis & views on UTV Software Communication & Lupin
UTV SOFTWARE COMM.      BSE Code: 532619      Volume: 1943     CMP: Rs 523.40

UTV Software Communications is India’s first integrated global media and entertainment com-pany. The company has five business verticals, which includes TV content production & services, motion pic-tures, broadcast, interactive and new media. The company and its subsidiar-ies create aggregate and disseminate content of various genres across var-ied distribution platforms. The strong pipeline of movies in FY11 and FY12 is likely to generate a healthy earnings’ stream for the company. The release of its own IP in FY10 in gaming will mark UTV’s foray into the new high-growth gaming industry and lead to the monetisation of investments done by the company in this area till date. Its broadcasting operations are likely to turn profitable in FY11. The company expects to post topline growth 75-80 per cent with EBITDA growth falling in the range of 18-21 per cent on the back of strong growth across its various verticals.

LUPIN   BSE Code: 500257 Volume: 82000   CMP: Rs 467.40

Lupin has settled its Lunesta (annual sales of USD 787mil-lion) litigation with Sunovion. The company will be able to launch the product 2.5 months prior to its patent expiry. This settlement augurs well for Lupin which, unlike its peers is a relatively new entrant in the high-risk-high-reward Para-IV segment. It is expected that the US revenues would post strong growth aided by the US’ prescription growth in Oct-Nov 2010 as per the IMS. The second half of a fiscal has traditionally been strong for the anti-infective Suprax. More importantly, in a bid to minimise the impact of a potential generic threat, it has decided to launch a double-strength version of 200 mg which will take its market share to 56 per cent in the US. While Lupin received US FDA approval for Suprax chewable tables (100 mg/150 mg/200 mg) on November 2, it is yet to launch this product in the market.

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