2-6-17
‘Sun Pharma’ is the largest Pharma (Medicine manufacturer) company in India. The
present market value of the company is Rs. 1.2 lakh crore. Its annual revenue
is more than Rs. 30,000 crore. From some time the market value of the
company is declining continuously.
Finance management has find out two major reasons for the continuous decline in the market
value of the company.
The promoter of the
company Dilip Shanghvi made some unrelated investment in Oil, Gas and wind
energy from the Cash generated from Sun Pharma Company. Oil, Gas and wind energy are capital
intensive ventures which require lots of funds. This put Sun Pharma into
financial stress. This created worry in the mind of Investors and hence share
price are on regular fall. The other reason is company had heavily invested in
buying other company such as Caraco, Taro and Ranbaxy etc. However
Investment made in these companies could not turn out profitable and became
burden on the balance sheet.
Q. 1 Find and define
the finance management decision taken by Dilip Shanghvi?
Q. 2 Mention two factors
affecting finance management decision in above case.
Q. 3 Name the financial
process which went wrong.
COMPOSED BY PATHAK SIR @pathaksirbst ( at twitter)
To be continued.....
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