Procter & Gamble Health Ltd. share price target

What should investors do? PGHL share price has grown by ~7.5x over the past five years (from ~| 728 in Aug 2016 to ~| 5530 levels in Aug 2021). We change our rating from HOLD to BUY rating on the stock given the good...

PGHL is a pharma cum consumer OTC player with strong and legacy brands in the vitamin minerals & supplement (VMS) category like Neurobion, Polybion, Evion (all vitamins), Livogen (iron supplement), Nasivion (nasal decongestant), Seven Seas (vitamin- substitute for malt based health drinks). Post the change in ownership (from Merck to P&G;), we expect these known brands to leverage on P&G;'s distribution might as most of these brands are driven by self-medication habit rather than doctor's prescription. It also has a presence in the prescription based cardio-diabetology category....

Merck's Q2CY18 results were a mix bag. Topline was 27.2% below our estimates given the divestment in the business, however PAT was 7.6% above our estimates given better than expected EBITDA. Sales grew by 33.3% YoY to Rs2.2bn. EBITDA margins were at 23.1% up QoQ from 12% given higher gross margins and reduced OE. APAT was...

due to substantial increase in other expenses. Adj. PAT of Rs162mn was up 9.4% at Mumbai which was held for sale resulted in Extraordinary Loss. We have not revised our CY18E/CY19E numbers. We initiated on this stock at a CMP of Rs1,010, after reaching our TP, we revise our...

Chemical segment revenue grew 27%YoY: Merck's pharma segment's revenue grew 14%YoY to Rs2.24bn from Rs1.96bn due to re-stocking by trade post successful GST implementation. Merck is a pioneer in the vitamin segment, with three major brands Neurobion, Polybion and Evion. Evion does not fall under the National List of Essential Medicines (NLEM) and hence its price hasn't been capped. The company's chemical business (26% of revenues) grew by 27%YoY. We expect the high-margin pharma business to drive future growth. Margin grew by 340bps YoY: Merck's EBIDTA margin grew by 340bps YoY to 15.8%...

Given the change in the product mix, we have maintained our CY18 revenue As we roll one-year forward our valuation to CY19E, taking in account that major products coming out of the purview NLEM and continuous launches in the Indian...

Pharma segment revenue grew 13%YoY: Merck's pharma segment's revenue grew 13%YoY to Rs2.45bn from Rs2.18bn due to re-stocking by trade post successful GST implementation. Merck is a pioneer in the vitamin segment, with three major brands Neurobion, Polybion and Evion. Evion does not fall under the National List of Essential Medicines (NLEM) and hence its price hasn't been capped. The company's chemical business (22% of revenues) grew by 12%YoY. We expect the high-margin pharma business to drive future growth. Margin grew by 140bps YoY: Merck's EBIDTA margin grew by 140bps YoY to...

EBITDA margin of 18.1% were higher than our estimates of 11.5%. Similarly, PAT of Rs317mn, +11.2% YoY, was higher than our estimates. We maintain our CY17E/18E estimates and TP (Rs1,179, 17x CY18E EPS+ CCE of Rs267/sh) and our rating of HOLD. Key Highlights and Investment Rationale India and other regions to fill the gap All players have seen the reversal patterns with the re-stocking happening in the channels which had got impacted during the last quarter due to the implementation...

Q2CY17 results were in-line with our estimates. Revenues were at Rs2.6bn lower by our estimates by 4.6% while Adj PAT was at Rs201mn, 3.2% above our estimate of Rs195mn. EBITDA margin of 10.7% were lower than our estimates of 11.1%, mainly on the back lower gross margins. During Q2CY17, profitability seems to be dented at the pharmaceuticals segment which accounted for 77% of its revenues, while the improvement in the chemicals segment helped to support the overall margins. We maintain our CY17E/18E estimates and TP (Rs1179, 17x CY18E EPS+ CCE of...

Merck KGaA, the parent company of Merck India (EMER), headquartered in Darmstadt, Germany is one of the oldest pharmaceuticals and chemicals company which was founded in 1668 and got listed in 1981. EMER has a market share of 0.6% in the IPM. We expect the EMER's pharmaceuticals portfolio to grow in-line with the industry growth on the back of its flagship brands (Evion, Livogen, Polybion, Nurobion, Nasivion and Seven Seas). Sustaining the Rank 1 position in the Vitamins/Minerals and Nutrients segment (50% of portfolio) is possible, however, negatively impacted by its large brands coming under the purview of the regulatory control and key concentration in few brands. Despite volume...

Merck Ltd reported Rs.1,988 Mn in Net Revenues, up by 2.6% YoY, but on a QoQ basis Net Revenues fell by 7.1%. EBITDA margin increased by 438 bps YoY to 6.5%. Lower expenses led to higher margins due to 1. Cost of Goods Sold (CoGS) as percentage of revenues decreased by 121 bps YoY (346 bps QoQ) and 2. Other Expenses as percentage of revenues decreased by 466 bps YoY (471 bps QoQ). EPS has increased from Rs.2.14 in Q1 CY14 to Rs.5.80 in Q1 CY15. During Q4 CY14 Merck reported EPS of Rs.0.65. Karvy initiated coverage report on Merck Ltd on May 04, 2015 with a Hold rating. We continue to maintain a Hold rating on Meck Ltd

Merck is currently increasing the capacity of its plant in Ponda, Goa. This could be a sign that Merck is planning for some new launches in injectables in the near future. Injectables are often high-margin products having the potential to boost profits.