Despite Covid-related challenges in H1, the management expects no material impact on FY21 performance due to strong demand recovery and new business sign-ups. Rest of the fiscal is expected to post strong growth across all segments and better margins amid cost rationalisation measures. Going ahead, we expect pharma segment to be back on the growth track thanks to consistency, visibility in all three segments- specialty, CDMO, generics. A key monitorable in the segment would be developments on the five contract manufacturing agreements that the company has signed for...

EV/EBITDA (FY22E) multiple assigned to pharmaceutical segment and bring in line with peers on better earnings outlook led by opportunities in Remdesivir API and formulations. We also increase our earnings estimate by...

Jubilant Life Sciences (JLS) reported 2QFY21 revenue of Rs23,749mn, which was above our estimate by 3.6% and above consensus estimates by 1.7%. Revenue was up 4.8% YoY and 25.5% QoQ and was led by strong growth in the Pharmaceuticals segment. Pharmaceuticals revenue at...

Jubilant Life Sciences (JLS) delivered higher-than-expected 2QFY21 earnings, led by better traction in a) the CMO/Generics category in the Pharma segment and b) the Life Science Chemical category in the Life Science...

We reduce earnings estimate of JUBILANT by 23%17.5%11.6% for FY21/22/23E due to weak and inconsistent performance of its Pharmaceutical segment (65% revenue and 78% EBITDA contribution in FY20) whose key contributors Radio pharma and Allergy are currently witnessing lower volumes caused by pandemic in US. Radiopharma being a hospital driven...

Jubilant Life Sciences (JLS) reported 1QFY21 revenue of Rs18,929mn, which was below our estimate by 16% and consensus estimate by 19.1%. Pharmaceuticals revenue at Rs1,0960mn was lower 17%/26% YoY/QoQ and LSI revenue at Rs7,369mn was lower 9%/10% YoY/QoQ. Pharma revenue was affected due to production suspension at Nanjangud API plant while Radiopharma and Allergy business saw an interim decline in revenues due to postponement of elective procedures amid COVID-19 related restrictions on hospital/physician visits. The decline in Radiopharma was steeper than expected. Also, being a high-margin business, the decline in net earnings was much steeper. LSI revenue was affected by lower demand and...

We expect a 4% earnings CAGR over FY2022, led by a 2.5%/3.5% sales CAGR in Specialty Pharma / Specialty Intermediates-Nutritional Products as well as a steady EBITDA margin. The earnings CAGR is partially impacted due to COVID-19-led temporary slowdown in the Radiopharma, CDMO, and Life We value JLS at 9x EV/EBITDA for the Pharma business and 4x EV/EBITDA for the LSI business, arriving at target price of INR975 on an SOTP basis. Overall, we expect a 4% earnings CAGR over FY2022, led by a 2.5%/3.5% sales CAGR in Specialty Pharma / Specialty Intermediates-Nutritional Products as well as a steady EBITDA margin. The earnings CAGR is partially impacted due to a We value JLS at 9x EV/EBITDA for the Pharma business and 4x EV/EBITDA for the LSI business, arriving at target price of INR975 on an SOTP basis.

Improvement in growth for LSI business remains opaque JUBILANT Q4FY20 earnings were higher than our estimate due to higher stockup in US generics, lower erosion in core portfolio and favourable forex. We assumed COVID impact to be realised in Q4FY20, but better availability of inventory and raw materials led to upbeat in EBITDA and EBITDA margin. We believe although Q4FY20 performance was better, COVID impact may drag...

Pharmaceuticals business segment growth likely to be healthy Recent long term contracts in the radiopharma business as well as Rubyfill traction in the US coupled with Europe launch later this year are expected to strengthen the speciality sub-segment growth, which is likely to grow at 14.7% CAGR in FY20-22E to | 3969 crore on the back of strong growth in the radiopharma business and consolidation of pharmacy business. The CDMO business was impacted in Q4FY20 due to Covid related challenges delaying API dispatches. However, going ahead, we expect this segment to...

Jubilant Life Sciences or JLS reported 4QFY20 revenue of Rs23,914mn, which was above our estimate by 4.2% and above consensus estimate by 1.4%. Net profit for the quarter stood at Rs2,605mn (Rs16.4 per share) and was 27.6%/8.9% above our/consensus estimates, respectively. Revenue growth was 3.3% QoQ but was flat YoY. Drug Discovery Solution business clocked Rs851mn in sales during the quarter and was up 25.5% YoY. The business is showing good momentum and with capacity set to double in 2-3 years. Net profit margin at 10.9% was up 211bps QoQ. EBITDA margin expanded by 52bps QoQ as the LSI business showed some improvement in EBITDA margin QoQ. Pharma sales...

30 May 2020 JLS has gradually improved margins for three years now, led by superior execution in the Specialty business in both the Pharma as well as Life Science Ingredient (LSI) segments. The overall Specialty business forms 51% of the total revenue. Particularly, the Specialty business in the Pharma segment recorded a 22% CAGR over FY1820, led by better traction as well as inorganic growth. We reduce our EPS estimate by 2% for FY21 to factor COVID-19-led slowdown, particularly in the Life Science Chemical and API segments. We continue valuing JLS on an SOTP basis to arrive at a price target of INR515 and maintain Buy on the stock. Revenues were flat YoY at INR23.9b (in-line). The Pharma segment (INR14.8b; 63% of sales) grew at 6% YoY. The LSI segment saw decline of 11% YoY at IN8b (34% of sales), which hampered overall growth. The gross margin improved 570bp YoY to 64.9% on a superior product mix.

13 May 2020 Under a non-exclusive agreement, Gilead has granted rights to JLS to register, manufacture, and sell the investigational drug Remedisvir in 127 countries (nearly all low-income/lower middle-income as well as several upper-middle/high-income nations), including India. This implies that currently 10 vials (1 of 200mg and 9 of 100mg) are required per patient (under critical condition). However, the top-10 countries (that form 84% of severely critical patients) are not a part of the 127 countries list for which JLS has supply permission, implying limited opportunity over the near term. We are awaiting the outcome of a study related to the use of Remedisvir for mild COVID- 19 positive patients, which can be a significant opportunity in the offing. In addition to JLS, Gilead has similar non-exclusive agreements with Cipla, Hetero, Ferozsons and Mylan to manufacture and sell Remedisvir in 127 countries.

Jubilant Life is an integrated global pharmaceutical and life sciences company engaged in pharmaceuticals, life science ingredients, drug discovery solutions and India branded pharmaceuticals. Company reported good set of numbers during Q3 FY19-20. Demand conditions across all Pharma businesses, Specialty Intermediates and Nutritional Products are strong. In the Pharma business segment, steady performance is witnessed in CMO business. Due to strong order book & new deals, the outlook remains robust. Also, Initiatives have been taken to increase total capacity by over 30% with annual potential revenues of around USD 30 million. New Lyo equipment installed at...

Jubilant Life Sciences or JLS reported 3QFY20 revenue of Rs23,152mn, which was above our estimate by 1.2% and below consensus estimate by 1.9%. Net profit for the quarter stood at Rs2,034mn (Rs12.8 per share) and was 8.5%/15.0% below our/consensus estimates, respectively. Revenue growth was 2.2% QoQ but was down by 2.6% YoY. Muted performance of LSI business affected the revenue performance. Drug Discovery Solution business clocked Rs680mn in sales during the quarter and was up 26% YoY. The business is showing good momentum and offers the potential for scale up. Net profit margin at 8.8% was down 247bps YoY and 222bps QoQ. The margin was down...

JUBILANT Adj. Sales declined 3% YoY to Rs 23.2bn (PLe Rs24.6bn) on account of 11% YoY decline in LSI (Life Science Ingredients) segment. Adj. EBITDA grew 3% YoY to Rs5.1bn (PLe Rs5.1b), while EBITDA margin expanded by 116bps to 21.9% (PLe 20.8%). With installation of instruments, Ruby-fill received better traction from hospitals though the expectation seems to be short-lived with new prolong legality of Bracco over IP assets. US formulations and API sales to remain muted in FY21E, given the FDA's six...

Jubilant Life Sciences or JLS reported 2QFY20 revenue of Rs22,659mn, which was above our estimate by 1.5% and below consensus estimate by 1.1%. The net profit for the quarter stood at Rs2,494mn (Rs15.7 per share) and was 16.4%/19.9% above our/consensus estimates, respectively. Adjusted for one-offs (tax benefit and one-time expenses), the net profit stood at Rs2,200mn, which is in line with estimates. EBITDA margin expanded 80bps QoQ as the share of Pharma segment expanded to 64% of sales as against 60% in the previous quarter. Pharma sales grew 10% QoQ on the back of strong QoQ growth in CDMO (sterile injectable CMO and API) and Generics business,...

With lower than usual growth in Pharma and declining LSI, JUBILANT sales Change in Estimates | Target | Reco were 3% lower than our estimates while adj. EBITDA and adj. PAT were ahead by 5% and 6% respectively. This is due to better adj. gross margin by 40bps...

The recent fall in the stock price from Rs 870 (Mar-19) to Rs 445 is largely led by unfavorable IFC loan settlement, USFDA issues and the concerns of ramp up in the specialty segment. Although IRR for IFC loan looks daunting at 20%+, it was 7-8% of total debt and raised at the time of distress in FY15. Meanwhile, the impact of FDA issues will be partly offset by the new block in Roorkee. With added capacities in CDMO and traction gained in radiopharma products, specialty business is driving both growth and profitability. At 6.6/5.6x FY21/22E EPS, along with 13-14% EPS CAGR, we remain positive on the stock's recovery. We maintain BUY on JUBILANT following an 8/12% beat on our EBITDA/PAT estimates for 1QFY20. Our TP is revised at Rs 845 (12x Jun-21E EPS) with a 5/10% cut to our FY20/21E EPS due to higher interest cost and tax rate.

Contemplating separate listing of various embedded business Jubilant Life Sciences or JLS reported 1QFY20 revenue of Rs21,819mn, which was below our/consensus estimates by 9.6%/7%, respectively. The net profit for the quarter stood at Rs1,850mn (Rs11.6 per share) and was 9%/7% above our/consensus estimates. Litigation costs and ongoing remediation measures which led to supply constraints in API and solid dosage business adversely impacted earnings to the tune of Rs480mn. Adjusted for these extraordinary items, net profit would have been Rs2200mn (Rs13.8 per share). Revenue underperformed expectations due to subdued volume/low prices in commodity...

Pharmaceuticals business segment growth likely to be healthy Recent long term contracts in the radiopharma business as well as approval for Rubyfill in the US are expected to strengthen the speciality sub-segment growth, which is likely to grow at 12.3% CAGR in FY19-21E to | 3572 crore on the back of strong growth in the radiopharma business and consolidation of pharmacy business. CDMO business is witnessing strong traction on the back of robust order book and incremental realisation in API segment. The generic business is also registering decent growth on the back of base...