The 26 reports from 10 analysts offering long term price targets
for Cadila Healthcare Ltd. have an average target of 442.33. The consensus estimate
represents an upside of 2.19%
from the last price of 432.85.
Our target price of Rs445/sh is based on 20x Sep 22 EPS We initiate coverage on Cadila with an ADD rating premised on: 1) Recovery in India business post the restructuring measures; we forecast 8% CAGR over FY20-23e; 2) While product concentration risk remains high in the US, timely approval of complex opportunities will be key to offset erosion and drive growth; and 3) R&D; investments in vaccines, biosimilars, NCE/NBEs, Covid portfolio adds potential upside opportunities which is currently not factored in our estimates. Moraiya resolution and further debt reduction will be the key catalysts to monitor in the near to medium term.
Cadila Healthcare (Cadila) reported 2QFY21 revenue of Rs37,623mn, which was above our estimate by 4% and consensus estimate by 2.4%. Revenue was up 6% QoQ and 16% YoY. Revenue growth was attributed to strong QoQ growth in USA, strong YoY growth in India (formulations and animal health) and API. Gross margin continues to be in the higher range (65-66%), driven by a better product mix and US business. EBITDA for the quarter stood at Rs8,634mn, up 38% YoY and 6% QoQ. EBITDA margin expanded by 20bps QoQ and was led by lower staff costs. The contraction in other expenses continued with marginal QoQ growth. Net profit stood at Rs4,734mn, up 4.3% QoQ. Net profit was adversely impacted by an exceptional charge of Rs1,320mn pertaining to the...
Q2 revenues were above I-direct estimates on all fronts due to better than expected operational performance and lower interest expense. On the US front, the company plans to venture into complex injectables (69 filed ANDAs), which is likely to provide meaningful traction from FY23-24 onwards. Similarly, addition of biosimilars (like Trastuzumab, Adalimumab, Pegfilgrastim, Bevacizumab, etc) for Emerging markets (like LatAm, MENA markets and South East Asia) are expected to provide growth impetus, going ahead. The wellness segment performance hinges upon Cadila's...
Solid presence in the chronic and sub-chronic segments (which are the key growth drivers for Indian pharmaceutical markets) and an improving outlook for the acute segment provide ample growth visibility for India business Easing pricing pressures, sturdy new product pipeline, and ramp up in the recent product launches would be key growth drivers going ahead for the US business. Strong growth prospects, sturdy balance sheet, and healthy return ratios would...
Cadila reported an in-line 2Q driven by strong growth across India, US and the API segment offsetting the muted growth in consumer segment. Revenue grew 16% YoY, an improved product mix (double digit growth in India formulations and US sales at $230mn, up $13mn QoQ) led to healthy gross margins at 64.9%. Impact of MEIS offset lower marketing spends, thereby, restricting EBITDA margins at 22.6%. Adjusting for the one-time charge of Rs1.3bn, for NCD purchase and forex loss, PAT grew 63% YoY at Rs6.2bn. Cadila strengthened its balance sheet by reducing debt of Rs27bn...
Cadila continues to bear heavy debt and high intangible assets from FY19 (acquisition of Heinz by its subsidiary Zydus Wellness). Hence, total intangibles remain high at Rs68bn, 65% of net worth, mainly due to the surge in goodwill from Rs14bn to Rs53bn in FY19 and Rs54bn in FY20. Other findings: i) Currency translation loss (FCTR) shot up by Rs4.3bn, out of which Rs2.8bn impacted cash flow. iii) Other operating income and other income together flared up to Rs10bn, 67% of PBT (FY19: 45% of PBT). iv) The cash tax rate lowered from 28% to 16% in FY20, whereas the...
Cost savings more than offset the pain of COVID lockdown on India sales Cadila Healthcare (Cadila) reported 1QFY21 revenue of Rs35,493mn, which was above our estimates by 10% and below consensus estimates by 4.4%. Revenue was down 2.1% QoQ and was up 4.2% YoY. QoQ decline was on account of COVID lockdown impacting India domestic formulation sales (down 7%) and US sales declining (down 8%). The decline was partly offset by the uptake in Asia, Africa, and LATAM and Consumer wellness business growing QoQ. The gross margin continues to be in the higher range (65-66%) driven by better product mix and US business. EBITDA for the quarter stood at Rs8,154mn, up 29% YoY and 1% QoQ. EBITDA margin expanded...
Outlook & Valuation: We reduce our Revenues for FY21E/FY22E by 1.4%/1.5% in FY21E/FY22E due to downgrade in domestic formulations and Consumer Wellness.
US (44% of FY20 revenues) grew at ~12% CAGR in FY16-20 backed by aggressive filings, product launches. Launch of authorised generics also contributed to overall growth. US pipeline (cumulative) consists of 390+ filed ANDAs, 95 pending final approvals. However, resurfacing of cGMP issues at Moraiya, imminent slowdown in base are main near term...
6 August 2020 CDH delivered in-line performance for 1QFY21. The decline in domestic formulation (DF) and consumer healthcare was more than offset by lower operating cost. CDH is progressing well to build Injectable/vaccine/biosimilars as additional levers of growth for the next 2-3 years. We have raised our earnings estimates for FY21/FY22E by 10%/9% to reflect better operating leverage/growth outlook for DF. We continue to value CDH at 21x 12M forward earnings to arrive at TP of INR460. We remain positive on CDH due to robust ANDA pipeline (including injectables/transdermals), renewed strategy in DF and completion of remediation measures at Moraiya. Maintain 1QFY21 sales at INRINR36.4b (v/s est. Sales growth was largely led by (a) US sales (45% of sales), up 19% YoY to INR16.2b, (b) LATAM/EM revenues (7% of sales), up 8% YoY to INR2.4b, and (c) API revenues (4% of sales), up 89% YoY. India revenue (41% of sales) comprising of DF, consumer and animal health was down 11% YoY to INR14.
Cadila Healthcare has emerged at the forefront of India's battle to fight against COVID-19. Company is one of the world's largest producer of anti-malarial drug hydroxychloroquine which is widely used as a prophylactic drug to prevent COVID-19 infections. Apart from that, to offer treatment options for COVID 19, company is now exploring multiple options from its portfolio of biological products and based on the available evidence, has selected the long-acting biological therapy, Pegylated Interferon alpha-2b as a potential treatment. It may be noted that Zydus Cadila has been commercially manufacturing Pegylated Interferon Alpha-2b under the...
US (44% of revenues) grew at ~12% CAGR in FY16-20 backed by aggressive filings, product launches. Launches of authorised generics also contributed to overall growth. US pipeline (cumulative) consists of 390 filed ANDAs, 99 pending final approvals. However, resurfacing of cGMP issues at Moraiya and an imminent slowdown in base are main near term headwinds. We expect US sales to grow at ~9.5% CAGR in FY20-22E to | 7502 crore. Our growth assumptions model near term Hydroxychloroquine opportunity in the US but besides this no significant meaningful launches....
Q4FY20 earnings were higher than our estimate considering 1) US growth of 5% QoQ (PLe 7% decline QoQ) due to stock-up and seasonality effect of Tamiflu 2) Consumer Wellness reported a growth of 21% YoY, while adjusted growth would have been 10%YoY. We change our rating to REDUCE (earlier SELL) and derive a new TP of Rs329 (Rs263) based on 18x PE (earlier 15x) of FY22E. We upgrade CDH on the back of 1) improved guidance for US market led by new products 2) biosimilar launch in India and EM's 3) resolution of...
Cadila Healthcare (Cadila) reported 4QFY20 revenue of Rs37,521mn, which was below our/consensus estimates by 4.6%/0.3%, respectively. Revenue was up 2.6% QoQ and flat YoY. QoQ growth was led by the US (favorable currency movement, Tamiflu suspension and HCQ) and a seasonally strong quarter for Zydus Wellness. Domestic formulation sales were flat on a YoY basis and were affected by the COVID-19 pandemic. The uncertainty around domestic sales revival persists in the near term as the COVID-19 pandemic continues to affect demand. During the quarter, sales to the tune of Rs2000mn were affected on account of COVID-19 pandemic....
20 June 2020 by regrouping it into the Mass and Specialty segments and b) differentiated launches in US Generics. We maintain our EPS estimates for FY21/FY22E and continue to value CDH at 21x 12M forward earnings to arrive at TP of INR420. We remain positive on CDH on account of better prospects in DF (encouraged by changed strategy), a healthy ANDA pipeline (including injectables and transdermals) in the US market, and regulatory works at Moraiya nearing completion. Maintain Buy. CDHs sales at INR37.5b (in-line) for 4QFY20 stood largely flat YoY. US sales (47% of sales) fell 1.9% YoY to INR17.6b. The India Branded Formulations business (24% of sales) was INR8.9b, almost flat YoY. EM and LATAM (5% of sales) revenue was down 17% YoY to INR1.7b, while API registered strong growth of 21% YoY, with sales of INR1.2b. The Consumer Wellness business grew 21.
The Q4FY20 results of Cadila Healthcare Limited (Cadila) were a mixed bag and reflected the impact of Covid-19. The sales at Rs 3752 cr were flat on a y-o-y basis, but missed estimates. Revenues amounting to Rs 250 cr were deferred due to supply chain / logistics issues, which the management expects to recoup in the current quarter. The gross margins for the quarter improved by 350 bps y-o-y but an increase in the employee cost and higher other expenses wiped out the gains, leading to a 60 bps y-o-y contraction in Operating Margins. OPM's stood at 21.1% while operating profit stood at Rs 791 crdeclining by 2.4% y-o-y,...
On the business front, despite the nationwide lockdown, domestic growth is expected to remain more or less stable. Exports growth, barring for one or two months due to congestion in all major ports globally, is also expected to remain strong due to 1) currency benefit, 2) slowdown in competition due to delay in new approvals that will be beneficial for existing players and 3) expected demand continuum across the world despite Covid-19. Some windfall is also expected in some critical productsa case in point is Hydroxychloroquine, a malaria drug that is likely to be repurposed as a prophylaxis for Covid-19 treatment in some cases....
Cadila Healthcare is India's leading vertically integrated pharmaceutical company. With its presence across the value chain, it manufactures finished dosage forms, active pharmaceutical ingredients, animal healthcare...
