Is Thyrocare (TTL) a Long-Term Stock?


[Full Disclosure: Thyrocare Technologies is a part of my equity portfolio]

So, this seasons hottest IPO has already gone live on the bourse and by now it has already seen 5 trading days, and has suffered some exchange of hands. The very moment its over subscription news appeared in the market, it was certain that it will be listed at an astronomical high. And it did. And some people exited after en-cashing this initial high. The chart below depicts how investors lapped up the opportunity to make a quick buck, moment after the bourse allowed its trading.

Thyrocare - Week 1

Having passed the initial stage, now the question remains is – Is Thyrocare Technologies a long-terms stock? Does this stock have the potential to multiply your invested money? Well, lets search for these answers based on some of the qualitative facts…

  1. Business Model Study – At the core, this is a medical diagnostic company which operates in a hub & spoke model. There are several collection centers and  centrally located labs which deliver the results (digitally), eliminating the need for the labs to be present everywhere. And essentially its a plug & play model, where the company can decide to expand to as many places as possible and hence create more customers overnight. {Company has several other interests in medical manufacturing, and other services as well.}
  2. Market demand – There is only one thing which remains constant about India’s medical needs – Its an under-served market. And its under-served to an unknown extent. And the quality of available options is so unreliable and poor that anything which comes with a quality assurance is bound to generate a demand.  {The major opportunity exists in those markets where the testing labs have been mostly unorganized and the prices are arbitrary.}
  3. Peer Group – The prominent names with similar business interests (excluding the pharma companies from this group) are only a handful, like Dr Lal Path Lab, SRL Diagnostics, etc. For a market as huge as this one, existence only a few organized players leaves a massive scope for future growth.
  4. Growth Opportunities – The below image illustrates the reach of Thyrocare across India. You can notice an opportunity which exists for the company on several states like Madhya Pradesh, Gujarat, etc. And these areas for physical expansion, along with technological improvements in the existing units is where there is a clear opportunity for growth.

Thyrocare - Authorised Service Providers

Some points for speculation

I am slightly surprised at both the bulk deals which happened on the listing day. These two trading houses, probably assumed that the prices would go high, but they soon realised the market sentiment, and hence didn’t waste their time being invested into it. But my bigger worry is not that they exited only a moments later, but they exited 100% with-in a few moments. Didn’t these guys have any hope that this stock would do any better in near-term? I think someone who better understands the psychology of these traders/brokers should help me understand this case.

Thyrocare - Bulk Deals

All in all, at this point of time, I believe this is a safe stock which has a potential to deliver some serious value enhancement in the years to come.

Data Sources:

[1] MoneyControl’s Data on ThyroCare Technologies Bulk Deals

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Tracking Infibeam’s market run


Now, its been a week since Infibeam’s shares went live in Stock Market. And as a curious e-commerce enthusiast, I find it important to keep a close watch on this stock and determine what is the mood of the market w.r.t. e-commerce and consumer internet companies. Also, this analysis will focus on how the management of these companies keep the faith of their investors alive and kicking.

And with all this in my mind, I will attempt to take a weekly shot on this company’s performance.

Week 7: 15th – 20th May 2016

Infibeam-Week7

It looks like, for the first time the stock went below the 500 level (however for a short period), and then someone magically pushed the prices back to the 500 levels.

Overall journey looks like the one below.

Infibeam-Week7

I am still hesitant to forecast anything about this company, but what surprises me the fact that even now I have not seen or heard company’s any initiatives after it went live which could reinforce the belief of the investors. Worst of all, the company has decided to totally stay away from media and has chosen not to update even once so far.

Week 6: 9th – 13th May 2016

Infibeam Week 6

For the first time since the listing, the signs of systematic ruining of prices are appearing now. And if you look closely, there is a pattern which illustrates the investor sentiments.

And the overall picture, so far appears as below:

Infibeam Week 6

Probably it would be a bit early to say that the season for bullishness on this stock are over, however the early trends hint at the same.

Week 5: 2nd – 6th May 2016

Infibeam Week 5

This week the stock was pushed to a new 52 week high of 537, almost 24.3% higher from the listing price, which couldn’t sustain and saw a downwards free fall.

Infibeam Week 5

This is the overall journey, and only visible trend so far is that the stock is maintaining the pushed-up price until now.

Week 4: 25th April – 29th April 2016

Infibeam - week 4

This week Infibeam achieved its by the biggest jump ever since it got listed to touch 527.30 (almost 22% higher than the listing price). The journey so far is as presented in the chart below:

Infibeam - week 4 Some of the Analysts have proposed that the target of 784.38 in the moths to come. So let continue and watch the developments closely.

Week 2 & 3: 11th – 13th April, 18th – 22nd April 2016

Infibeam-till 22nd April 2016

These two combined weeks had a total of 7 trading sessions, instead of regular 10 sessions, and hence it made sense to report these two weeks developments together. In these 10 trading sessions, there is some surge which has happened and which needs some analysis.

Infibeam - 21st April 2016

On 12th April someone started inflating the prices in a schematic manner. These definitely can are not the regular individual investors who suddenly started to develop so much trust in the company’s fundamentals that they started playing in huge volumes. Definitely these volumes (as marked in the chart above) are majorly contributed by some of the institutional investors who have started putting-in the volumes in a planned and staged manner, as indicated in the volumes chart and its impact can be seen as spikes in the price chart. And hence what we see here is a manufactured price jump of almost 10% with high volatility in between the trading hours.

Infibeam-week3

 

Week 1: 4th – 8th April 2016

The below info graphics presents the daily price movement on NSE, starting from 4th April 2016.

Infibeam-Stock Market Debut

A few points worth a note are:

  • Infibeam made a debut on the  stock exchanges at a price of Rs 453/- , and by the 5th trading session it was trading at Rs 448/-. I don’t want to make any inference based on the price movements of just one week. And it will be unfair for this company to get any comments based on this small data set.
  • In this one week, there is something worth taking a note happened – Nomura Singapore reduced its stakes in Infibeam from 5.67% to 4% (by offloading its shares and making a quick buck riding on the bullish sentiments of those investors who joined the bandwagon after they had missed the IPO bus.

 

References:

  1. Google Finance’s Page on Infibeam
  2. Capital Mind’s article: Nomura Singapore reduces stakes in Infibeam