CSL has entered into the list of top 10 Australian businesses. CSL an Australian founded #biotech, floated in 1994 at $2.30 a share (equivalent to 77cents these days), and has risen up to 5000 per cent to around $37 per share. Shareholders have received dividends of $5 per share and that is not something that happened by accident. CSL enjoys two hurdles for competitors to enter the market. Firstly strict licensing regulations make it costly for competitors to enter the market and secondly a company that does manage to enter the market will have to persists with loses until they can produce enough volume, as this is an industry where profit follows large numbers. Therefore the market is held strong by 3 players, CSL, Baxter and Grifols-Talecris. CSL's high quality management has been described as "icing on the cake" for investors. Many companies who have experienced success sees their management become complacent and lazy in their decisions. CSL's management hasn't let success slow them down and have demonstrated this through smart acquisitions. Of course there are risks, government regulations and batch contaminations are top on the list, but the strength of CSL means they could deal with these with ease. Analysts predict CSL will continue to see at least 5 per cent growth in profits per year. Therefore these stocks will not be sold lightly and if you get the chance to buy in at a good price, I would take it.
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To hear more from successful biotech companies such as CSL, go to BioPharma Australasia held on the 23-24 August at the Swissotel Sydney