SIP (ASX) Another new high

Originally posted by lakota6 ↑

Well done on purchasing SIP and hanging on , similar to myself. Just one correction in your post is that MYX is not a wholesaler and not in competition with SIP and API. MYX is a generic drug company only. The other player in Australian Pharmacy wholesale is Symbion , which is owned by Ebos ( code EBO ) which has dual listing in Aust and NZ. SIP has had it's problems , with the massive goodwill write down in its generics business , criminal charges and class action. The sale of it's generic business to Sth African company Aspen which enable SIP to become debt free was a turning point. The problem moving forward , as you rightly pointed out , is to increase nett profit. For this to happen SIP has to look outside the wholesale distribution area , which is too regulated by government , and find new areas . One area I think is of vital importance in hospital supply . Mark Hooper has indicated that is an area that interests them. SIP was always under priced against API , but the question was was API overvalued or SIP undervalued, it seems to be the latter.

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Hi Lakota6,

Thanks for your post, and congratulations on your windfall too. With no disrespect, I would contend that it's foolhardy to disregard MYX as not being a competitor (directly or indirectly) for SIP, these guys are going (motoring) forward, and have sprung from the roots of FH Faulding. Similar business models previously, if my memory serves me correctly? Who knows where, and what market segment MYX will hold in the future? Besides, big business is dictating the abolition of the middleman, and the supply chain is not what it was.
In relation to hospital supply, you make mention of the highly regulated environment, but aren't SIP faced with the same government bureaucracy, should they head down that road? Personally, I don't feel the whole Amcal or Guardian brand is the future, they tend to be seen as the poorer cousin of Chemist Warehouse and Priceline. In any case, I have no easy answers, but I don't see much further SP growth unless SIP widen their collective circle. However, I'm happy to hold, wait and see how this revival continues to play out.