Fermenta Biotech Ltd. share price target

Fermenta Biotech Ltd (FBL) has posted revenue of INR 1,096mn with a 16.1% YoY increase, which was 8.5% above our estimate of INR 1,011mn. The revenue growth was mainly driven by strong traction in the Human VD3 business and higher contribution from Fish Oil Cholesterol. In Q1FY22 the vitamin D3 (VD3) business contributed 77% to the overall revenue. The revenue ratio of VD3 between Human Nutrition & Animal Nutrition has moved from 47:53 in Q1FY21 to 77:23 in Q1FY22 in favour of Human Nutrition. Volumes of Human Nutrition VD3 continue to grow Q-o-Q and Y-o-Y while that of Animal Nutrition continues to show a decline. EBITDA margin for the quarter was 23.5% better than our estimate of 21.1% (EBITDA margin of 10.2% in Q4FY21, 23.7% in Q1FY21) supported by margin...

Fermenta Biotech Ltd (FBL) has posted revenue of INR 995mn with a 54.1% YoY increase, which was 15.8% above our estimate of INR 859mn. The revenue growth was mainly driven by strong traction in Human VD3 business and higher contribution from Fish Oil Cholesterol. In Q4 FY21 the volumes of Human Vitamin D3 40 MIU were higher by 101% over Q4 FY20, while the volumes of Animal Vitamin D3 Feed 500 were lower by 14% over Q4 FY20. While on an annual basis, the volumes and average prices of Human Vitamin D3 40 MIU were higher by 71% and 4% respectively over previous year, however the volumes and average prices of Animal Vitamin D3 Feed 500 were under pressure and were lower by 35% and 17% respectively over previous year. Reported EBITDA margin contracted by 439bps to 10.2% level impacted largely due to 1284bps decline in the gross margin impacted by higher contribution from Fish Oil Cholesterol with low margin. Management is confident to improve margin profile from the current level on the back of strong traction in Human VD3, demand recovery in...