Medi-Caps Ltd. Detail
As per the Company website it is involved in manufacturing of hard gelatin capsule shells.It has emerged as India’s second largest & admired supplier of empty hard gelatin capsules.
So it is different from normal Pharma Companies which are involved in manufacture of Drugs and Formulations. You might have noticed the Hard Outer container of Capsule drugs. This company manufactures the Capsule shells. So Pharma companies are consumer of end product from this company.
The product line of the Company can be divided into below categories
- Empty Hard Gelatine Capsules
- Halal Gelatine Capsules
- Liquid Filler Capsules
It also manufactures Sodium Lauryl Sulfate free capsules as mandated by some countries like Japan and several European Union countries.
Now lets look at performance of this company over the years.As per Dow theory of technical analysis price performance over a period of time reflects Company state.
Medi-Caps Ltd. Stock Performance
If you closely observe the long term price performance can be divided into 3 sub charts. One from year 2002 to 2009. Other from year 2009 to 2014 and the last one from year 2014 to now.
The reason is stock made lows and highs in these three parts. From year 2002 to 2009 stock moved from 65 paisa mark to 9 in between touching 30 INR mark as well. Second leg of 2009 to 2014 was same with low near 9 INR (same as that of 2009) and high being 20 INR mark.
The third leg which is in progress stock touched above 30 mark and is trading near 15 levels. You can assume it to touch near 10 and then bounce back a per past data. In long run it gave close to 25 times return from 2002 period. The entry and exit points in this counter is important to make money.
Medi-Caps Ltd. My Opinion
Medi-Caps limited is in Pharma sector. There are many Pharma companies listed on the stock exchanges but this one is with a difference.
Pharma companies create Tablets, Injections and capsules. The company fortunes depends on creation of Capsules by Pharma companies. More number of Capsules created will increase demand of products from it.
Capsules are required depending upon medicine usage. So there will always be demand of Gelatine capsules in Pharma companies. So market is already there. Company have to grab the opportunity. Note India is fast becoming prominent figure in International Pharma map.
I have already invested in a Pharma company and planning to include one more in portfolio soon. I will be tracking this company in my stock watch list to get more idea about it.
In case you are interested then you can track the company by adding it to your stock watch list. That way you can keep close eye on the Company.