Zydus Wellness Ltd. share price target

Price hikes taken; normalcy awaited

Q4 revenue grew 5.6% YoY (65% QoQ) to Rs 6.4bn aided by price hikes; volumes muted

Product innovation, distribution expansion and Heinz India merger synergies expected to aid brisk PAT CAGR of 11% for FY21-FY24

The company has more than 850 distributors with direct reach of 0.55 million retail outlets. Its high gross margins at ~55% give it a leeway to spend ~13% of sales on advertisement to support new products...

It commands dominant market share in sugar substitute (96%), prickly heat powder (34.5%) & glucose powder (58.3%) categories The company has more than 1700 distributors with direct reach of 0.55 million retail outlets. Its high gross margins at ~55% give it leeway to spend ~13% of sales on advertisement to support new products...

new benefits to consumers. The company is the market leader in most of its product categories. In FY19, ZWL acquired Heinz India, whose portfolio too had market leadership positions in niche categories catering to health & wellness segments. Portfolio of Heinz included Glucon D, Complan, Nycil and Sampriti Ghee. ZWL aims...

Beat on all counts; margins to remain firm

In the last one year, the company focused on new product with the launch of 11 new products. It is also supporting new products like Nutralite Doodh Shakti butter spread & Nutralite Choco spread through new ad campaigns. ZWL launched Soothing body mist' under Nycil brand in Q4. On the distribution expansion side, the company doubled its direct reach to 5.5 lakh outlets and is also driving outreach programmes to increase penetration in hinterland. It has a presence in more than 800 towns now. E-commerce channel sales increased 3x in FY21. It is now contributing 3.6% of sales. We...

Zero tax rates to stay till FY25

Focus on new product launches; foraying in new markets The company has launched nine new products or variants in 2020, which includes Sugarfree D'lite dark chocolate, Aloevera Gel under EverYuth & Glucon-C ImmunoFizz, Nycil sanitisers wipes in Q3. It also introduced Nutralite Choco Spreads & smaller sachets in Complan earlier. In January 2021, it launched Ghee & Probiotic butter spread under Nutralite DoodhShakti brand. ZWL is looking to enter new markets & build scale in Saarc, Middle East & South East Asia countries. We believe aggressive new...