The stock price of Cupid Ltd (Cupid), which manufactures and sells male and female condoms, has gone up by over 30 times in the last three years and currently trades at Rs. 320. The company, which has a current market capitalisation of about Rs. 350 crore, operates both in the business to business (B2B) category as well as business to consumer (B2C) category.
Increasing awareness about the benefits of safe sex, consistent orders from international development agencies such as the United Nations Population fund, World Health Organisation, National Department of Health – South Africa and from Russia and Sub-Saharan African countries, have kept the pipeline robust. Export orders contribute close to 80 per cent of the sales revenue for the company.
Besides, Cupid and Hindustan Latex, two of the four major manufacturing companies worldwide, have started manufacturing female condoms recently.
With increasing female literacy and growing women empowerment worldwide, the female condom product is expected to see a substantial uptick in sales.
As of September 2016, the company has an order book of about Rs. 180 crore to be executed till June 2018. Of this, Rs. 40 crore is for higher margin female condoms.
Repeat orders
Besides, the company management has indicated good order book inflow through long-term repeat order contracts from existing B2B customers, international development agencies, governments of other countries and other private orders. The company has a high capacity utilisation of close to 90 per cent.
Going forward, the management intends to increase sale of higher margin female condoms through both B2B and B2C channels.
A small share of the revenue is contributed by the sale of lubricant jelly.
Between FY12 and FY16, sales and net profit grew at an annualised rate of 24.4 and 126.9 per cent respectively. For FY16, the revenue was about Rs. 62.8 crore and net profit was Rs. 15.9 crore.
For the nine months ending December 2016, revenue and net profit was Rs. 66.7 crore and Rs. 15.6 crore respectively, a growth of 49 and 38 per cent respectively compared to the same period a year earlier.
The cash at the end of September 2016 is around Rs. 17 crore, which can be used for brand promotion and plant automation and expansion.

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