Category: Healthcare

Race for Fortis Healthcare: Munjals, Burmans enter the fray

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

The race to acquire Fortis Healthcare has intensified with one more suitor – Sunil Kant Munjal of Hero Enterprise and the Burman family of Dabur – entering the fray.

Both Munjal and the Burmans, in a joint bid, have approached the board of Fortis Healthcare proposing to invest Rs 1,250 crore in the company.

The race has intensified with three suitors in the fray. Manipal Hospitals backed by private equity player TPG were the first one to express interest.

Malaysia-based IHH Healthcare Bhd has made an offer for Fortis Healthcare.

In an offer letter to the board of Fortis Healthcare, both Sunil Kant Munjal and the Burman family, who are already existing shareholders in Fortis Healthcare, have proposed to infuse funds, which, according to Munjal, “will go beyond addressing the urgent liquidity needs of the company and help the operations stabilise with immediate effect.”

According to the letter, immediate investment from both companies will be Rs 500 crore and remaining Rs 750 crore post due diligence. The proposal is under evaluation.

“Our offer is in the best interest of Fortis Healthcare,” said Munjal. “In fact, all those connected with the company’s ecosystem, its shareholders, patients, their attendants, the community and public at large, in addition to the lenders, suppliers, doctors, medical and non-medical staff will benefit from it. We are investing in the company and our aim is to create value for all stakeholders.”

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

IHH makes non-binding offer for Fortis Healthcare

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Malaysia-based IHH Healthcare Bhd  has taken the plunge and made a much anticipated counter offer for Fortis Healthcare, according to sources, as the fight for Fortis Healthcare intensified.

IHH reached out to the Fortis board last evening with a non-binding offer. The company is looking to conduct a due diligence to give a definitive bid to buy Fortis Healthcare.

The Fortis Healthcare stock gained in trade on the back of the counter offer. Sources said, given that, IHH has proposed to buy Fortis for around $1.3 billion, the share price is likely to be up to Rs 160/share.

IHH’s offer is at a premium to the binding bid given by Manipal Hospitals backed by PE firm TPG.

When contacted, Fortis Healthcare declined to comment.

An IHH spokesperson also declined to comment. “We decline to comment. We will make appropriate announcement(s) should there be any material developments.”

IHH’s offer to buy Fortis Healthcare comes soon after Manipal Hospitals sweetened its offer to make the deal palatable to the shareholders of Fortis Healthcare.

Reports suggest that East Bridge Capital, along with other minority shareholders, had opposed the original deal announced by Fortis and Manipal.

IHH’s investments in India:

IHH was the second largest shareholder in Apollo Hospitals, with a 10.85% stake in the company, and had invested $44.23 million into the healthcare company in 2005.

By May 2017, however, IHH exited the entire investment in Apollo with returns of $288 million, an amount worth about six times its initial investment. The company maintains two joint-venture facilities with Apollo in Kolkata and Hyderabad.

In April 2005, IHH had taken a majority stake in Continental Hospitals, a 750-bed super specialty facility, for Rs 300 crore. It was the first direct acquisition for IHH in the country.

IHH also acquired a 73.4% stake in the Hyderabad-based Global hospitals for Rs 1,284 crore, in August 2015 . Global has around 5 hospitals in Hyderabad, Mumbai, Bengaluru, and Chennai, with a total of about 1100 beds.

Ironically, IHH had acquired the Parkway Pantai Group, the crown jewel in its investments abroad, after a prolonged battle with Fortis.

Globally, IHH has around 8,000 beds across 45 hospitals in 10 countries. The company merged all healthcare assets, including Pantai in Malaysia, before public listing in 2012.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Q4 earnings to be boosted on low base of Demonetisation and GST

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Fourth quarter earnings in most of the sectors will be better-than-expected, helped by a demonetization and Goods and Services Tax (GST) – hit low base, CLSA said in a note.

The brokerage said that the earnings growth will be at 17%. Domestic revenue growth will be at 10% year-on-year, which is expected to be a six-month high.

The auto sector is expected to report 18% growth in the quarterly earnings. CLSA added that, Tata Motors’ earnings might be hurt following a weak trend as the Jaguar Land Rover’s retail volumes fell by 8% year-on-year to 83,732 units in March 2018.

The auto makers performance lagged the most in the UK and Europe as a steep decline was seen in the diesel vehicle sales.

The consumer or FMCG sector will also post a 18% rise in the fourth quarter, after being worst hit by demonetisation and GST related hiccups. The key expectation from this quarter, is sustained recovery and positive management commentary.

CLSA added that domestic sectors like real estate is expected to post 63% of earnings growth as various real estate companies are encouraging pre-sales of properties like Sobha Ltd.

The banks will report a 46% decline in the quarter, hurt by higher non-performing assets (NPA) provisioning, CLSA said. Corporate banks are expected to witness higher provisioning, driving potential earnings downgrades.

Also Read: Eye on Q4 earnings: Experts discuss what to expect from Pharma, FMCG & other sectors

Earnings will decline 20% in the pharma sector for companies like Sun Pharma and Lupin, as they face the brunt of the pricing pressure in the U.S as well as outstanding regulatory issues, especially by The Food and Drug Administration (US FDA) on plants.

“Analysts expect low single digit revenue growth, with revenues from the US – a vital market – likely to decline for the fifth consecutive quarter due to faster drug approvals resulting in more competition and consequently pressure on price margins,” a report said.

However, 10% rise will be seen in the domestic markets for the drug companies as operations normalises post GST and demonetisation.

The intense competition faced from Reliance Jio’s entry into the market has caused Bharti Airtel to report its first ever quarterly loss in over 15 years and Idea to post its sixth consecutive loss, CLSA said.

The average revenue per user (ARPU) will continue to slip in the upcoming quarter, despite strong subscriber addition on account of migration of Aircel and Reliance Communications’ (RCOM) subscribers, Edelweiss said in a note.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Manipal Hospitals raises bid for Fortis hospital business

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Manipal Hospitals Enterprises Private Ltd raised its offer to buy rival Fortis Healthcare Ltd’s hospital business by about a fifth in an attempt to win over minority shareholders opposed to the deal.

The new offer values Fortis’ hospital business about 21 percent higher at 60.61 billion rupees ($933.3 million), or 116 rupees per share, Manipal Hospitals said in a statement late on Tuesday.

Manipal first offered to buy Fortis last month in a deal that would combine its 14 hospitals with Fortis’s portfolio of 34 hospitals, creating a 150 billion rupees company and formidable rival to Apollo Hospitals Enterprise Ltd.

But the previous bid, which offered shareholders 10.83 shares in the combined company for every 100 Fortis shares held, was panned by investors. It knocked Fortis stock down 14 percent on the day the deal was announced and prompted Chief Executive Bhavdeep Singh to make conciliatory comments about keeping minority shareholders’ concerns in mind.

The old offer met with disapproval from shareholders including major Indian equity investor, Rakesh Jhunjhunwala, the Economic Times newspaper reported.

Manipal said as per the new offer, existing Fortis shareholders will roughly own half of the new company.

Under the previous terms, Manipal Chief Executive Ranjan Pai would have owned about 38 percent of the new company, which would be listed on Indian stock exchanges. U.S. buyout firm TPG was expected to hold 20.7 percent.

Manipal‘s statement on Tuesday did not mention how much of the new company Pai or TPG would own.

“We hope that our revised offer addresses the concerns certain Fortis shareholders had raised and believe this offer is in the interests of all stakeholders, including Fortis’ shareholders,” Pai said.

Fortis shares were trading down 0.2 percent as of 0437 GMT after having risen as much as 3.6 percent early in the session.

Also Read: Manipal hospital chief looks to shore up shareholder support for Fortis deal

A deal will take some pressure off Fortis, which has been under a cloud as authorities investigate whether its founders, brothers Malvinder Singh and Shivinder Singh, who are no relation to the CEO, took funds from the company. The brothers have denied the allegations.

For Manipal, a deal would mean greater access to India’s burgeoning healthcare market, estimated by Deloitte to grow three-fold to $372 billion by 2022.

Private Indian healthcare companies have grown rapidly in recent years, boosted by increasing demand for better healthcare in an under-resourced public health system.

Manipal also said on Tuesday it expects to buy a 30.9 percent stake in Indian diagnostics chain SRL Ltd, which is partly owned by Fortis. Manipal plans to fold SRL into the new company.

($1 = 64.9400 Indian rupees)

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Eye on Q4 earnings: Experts discuss what to expect from Pharma, FMCG & other sectors

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

The fourth quarter results season will begin in a few days. It has an advantage of the low base of the demonetisation quarter but it also has the disadvantage of some continued GST adjustment and weakness in corporate banks.

To discuss what should one expect from different sectors like IT, FMCG, autos, capital goods, oil & gas, pharma, cement, metals, realty, power, telecom etc., CNBC-TV18 spoke to their in house research team and market experts Nischal Maheshwari, Head – Instl Equities, Edelweiss Securities Gautam Duggad, Head-Institutional Equities, MOSL and Sanjiv Bhasin, Executive VP-Markets, IIFL who know the numbers like the back of their hand.

Cement Sector: 

The fourth quarter of FY 18 has traditionally been ideal for cement companies, but this time around cement prices failed to rise in the busy season, despite rising cost pressures, Edelweiss said in a note, expecting that the cement industry will be a disappointment in the quarter.

Also Read: Cement has had its challenges in the fourth quarter

Metal Sector:

In terms of the fourth quarter of 2018, the ferrous stocks may report a better-than-expected quarter owing to the sharp price increase, while from non-ferrous space, Nalco is likely to deliver strong results owing to the surge in alumina prices.

Also Read: Metal sector may report better results owing to surge in prices

Power Sector:

Fuel wise, while the coal-fired plants reported a moderate growth given the shortage of coal supply, hydro generation was a bit weak given lower snowfall. While the early onset of summer might create challenges for distribution companies, it augurs well for consumer durable players like Voltas, Havells etc.

Also Read: Early onset of summer: Someone’s pain is someone else’s gain

Industrial and Infrastructure Sector:

Fourth quarter is seasonally strong for industrial and infrastructure companies. Margins are expected to remain stable while order-books are expected to burgeon given the flush of order inflows especially for roads and transmission and distribution space.

Also Read: Execution ramp up to drive Q4 earnings in the infra sector

Pharmaceutical Sector:

For pharma companies, domestic markets should perform better though. Expect up to 10% growth due to normalising of operations post GST and a favourable year-on-year base due to demonetisation.

Also Read: Pharma poised for another painful quarter

Fast Moving Consumer Goods (FMCG) Sector:

FMCG sector earnings were most impacted by demonetisation & Goods and Services Tax (GST) related hiccups last year. GST rates for a large swathe of daily consumption items were revised lower in November 2017, so Q4 FY 18 will have the first full quarter impact of lowered prices and higher off-take.

Also Read: FMCG Q4 FY18: Sector Expectations – The Hope Of Sustained Recovery

Telecom Sector: 

The average revenue per user (ARPU) will continue to slip in the upcoming quarter, despite strong subscriber addition on account of migration of Aircel and Reliance Communications’ (RCOM) subscribers, Edelweiss said in a note. Jio has signalled cut throat competition will continue, with the company providing free prime services for its subscribers for another year, contrary to market expectations that it will start monetising its users.

Also Read: In telecom sector, ARPU to continue to slip in Q4 FY18, says Edelweiss

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow