Mutual Funds Commodities Research Tax Planning IPO Our Team Contact Us    
Google
Web www.equitybulls.com
Union Budget
Budget 2011-2012 Home
Industry Expectations - Budget 2011-2012
Industry Reactions - Budget 2011-2012
Budget 2010-2011
Budget 2010-2011 Home
Industry Expectations - Budget 2010-2011
Industry Reactions - Budget 2010-2011
Contributor's Corner
Bonanza Portfolio
Hemant K Gupta
Krish Bhatt
S A A R T H I
Trinity Investments
Exchange Information
BSE 2009 Holidays
NSE 2009 Holidays
Investor Guide
Depository & Dematerialisation
Grievance Redressal
Investor Guide
SEBI
Trading of Securities
Transfer of Securities
Your Rights
Budget 2009-2010
Budget 2009-2010 Home
Industry Expectations - Budget 2009-2010
Industry Reactions - Budget 2009-2010
Interim Budget 2009-2010 Home
Industry Expectations - Interim Budget 2009
Budget 2008-2009
Railway Budget 2008-2009
Industry Expectations - Budget 2008
Union Budget 2008-2009
Highlights of Budget 2008-2009
Summary of Budget 2008-2009
Industry Reactions - Budget 2008
IPOs
Current IPOs
Past IPOs
IPO Subscription
Mutual Funds
Gold Exchange Traded Fund
MF Unique Holding
Forthcoming Dividends
ELSS Schemes Comparison
Tax Plans
New Fund Offers
Research
Arbitrages
Equity
Market Whispers
Tax Planning
Home
Equity Linked Savings Scheme
Post Office MIS
9% GOI Senior Citizens Savings Scheme
8% Savings (Taxable) Bonds
Kisan Vikas Patra
National Savings Certificate
Public Provident Fund
Research

| More

Crisil - Panacea Biotec Ltd - Independent Equity Research Report

Posted On: 2011-12-14 22:00:23

Panacea Biotec Ltd (Panacea) has so far witnessed strong business momentum in both combination vaccines and formulations. While demand continues to gain traction, Panacea's growth will likely hit a roadblock as WHO (World Health Organisation) has de-listed its combination vaccines, including the high-margin EasyFive, from the pre-qualified list of vaccines. We have lowered our FY12 estimates to account for the loss in business. However, we maintain our fundamental grade of 3/5 as we believe that the problem is likely to be a short term one and the long-term business prospects look optimistic. Growth momentum in combination vaccines stalled in the near term.

Combination vaccines had been witnessing strong traction in demand, apparent from EasyFive's ~220% y-o-y revenue growth in FY11. WHO has recently delisted the product because of quality management issues. Consequently, we expect growth to get stalled as UNICEF is the largest customer. However, management is expecting to fix the issue in 3-4 months. We expect the supplies to resume by Q1FY13 and remain optimistic on the long-term growth prospects of combination vaccines.

Expect gradual de-growth in polio vaccine sales

Polio vaccine sales declined by ~17% y-o-y in FY11 largely due to: 1) decline in procurement by UNICEF because of increase in polio eradication globally, and 2) Indian government now procuring vaccines on need basis only. However, we view limited near-term risk to demand for polio vaccines given the significant number of cases still recorded globally. Going ahead, we expect sales to de-grow, but on a more gradual curve.

New products and geographic expansion to benefit formulations

Formulation sales grew ~24% y-o-y in FY11, largely driven by strong traction in its existing products and entries into new markets. Exports grew by ~110% driven by strong demand for Tacrolimus and Cyclosporine in Latin America. Going ahead, we believe that catalysts such as expected approval in regulated markets and launch of new products will continue to crank the growth engine.

Revenue growth and profitability curve to cave-in in FY12

We expect FY12 revenue to decline ~25% y-o-y to ~Rs 8,650 mn and EBITDA margin to contract by 1,440 bps to ~8% on loss of EasyFive sales to UNICEF and higher raw material costs driven by unfavourable forex movement. We expect revenue and margins to improve to ~Rs 11,934 mn and 19.0% in FY13.

Valuations the current price has 'upside'

Based on our new estimates, we arrive at a fair value of Rs 100 per share. We propose a valuation grade of 4/5, indicating that the market price has upside from the current levels.


Source: Equity Bulls

Click here to send ur comments or to feedback@equitybulls.com


Disclaimer:The article above is a gist / extract of the original report prepared by the research firm / brokerage firm. This article is not to be considered as an offer to sell or a solicitation to buy any securities. This article is meant for general information only. www.equitybulls.com, its employees or owners or the research firms, its employees or owners won't be responsible for any liability that may arise from information, errors or omissions in these articles. www.equitybulls.com or its employees or owners / the research firms or its employees or clients or owners may from time to time hold positions in securities referred in this article. For detailed research reports, please contact the concerned research firm directly.





Other Headlines:

Company Update: FIEM Industries Ltd - BUY - TP Rs.1254 - Kotak
Sun Pharma: 1QFY2018 Result Update - Angel Broking
Cipla: 1QFY2018 Result Update - Angel Broking
Consumer Products (Cautious): 1QFY18 review - Muted quarter, but better than subdued expectations - Kotak
Result Update: Time Technoplast Ltd - ACCUMULATE - TP Rs.210 - Kotak
Result Update: PNC Infratech Ltd - ACCUMULATE - TP Rs.154 - Kotak
Result Update: Praj Industries Ltd - REDUCE - TP Rs.73 - Kotak
Result Update: Blue Star Ltd - ACCUMULATE - TP Rs.741 - Kotak
Result Update: AIA Engineering Ltd - SELL - TP Rs.1130 - Kotak
Result Update: KNR Constructions Ltd - ACCUMULATE - TP Rs.236 - Kotak
Result Update: Finolex Industries Ltd - BUY - TP Rs.712 - Kotak
HSIL Q1 FY18 Result Update Rating - HOLD - Arihant Capital Markets
CEO & MD of Infosys Resigns: Angel Broking
Indoco Remedies: 1QFY2018 Result Update - Angel Broking
Aurobindo Pharma: 1QFY2018 Result Update - Angel Broking
Insurance: Widening the base - Kotak
Banks : NIM-short term tailwinds and cyclical headwinds : Deciphering the cause of recent compression of NIM - Kotak
Jagran Prakashan Q1 FY18 Result Update Rating - HOLD - Arihant capital Markets
NCLT admits RCOM merger petition with Aircel: Angel Broking
Views on Sun Pharmaceutical Industries Limited 1QFY2018 Results: Angel Broking
Economy: RBI surplus transfer: real danger of fiscal slippage - Kotak
Views on Cadila Healthcare Ltd 1QFY2018 Results: Angel Broking
Views on Cipla Ltd 1QFY2018 Results: Angel Broking
The Pitch Report - Result Update: Balmer Lawrie Company - BUY - TP Rs.289 - Kotak
The Pitch Report - BBTC - BUY - TP Rs1130 - Kotak
Result Update: NMDC - REDUCE - TP Rs.130 - Kotak
Result Update: Mahanagar Gas Ltd - SELL - TP Rs.1006 - Kotak
Result Update: Tata Motors - BUY - TP Rs.514 - Kotak
Result Update: Gabriel India Ltd - BUY - TP Rs.190 - Kotak
Initiating Coverage: Radico Khaitan Ltd - BUY - TP Rs.200 - Kotak
Views on Indoco Remedies Ltd 1QFY2018 Results: Angel Broking
Bajaj Auto announces a tie-up with Triumph of UK: Angel Broking
Technology 1QFY18 review: Tactical margin levers exercised well - Kotak
Cement - August 4, 2017 - Kotak
Result Update: JSW Steel Ltd - REDUCE - TP Rs.230 - Kotak
Result Update: Carborundum Universal Ltd - SELL - TP Rs.324 - Kotak
Result Update: Container Corporation of India Ltd - REDUCE - TP Rs.1210 - Kotak
HCL Technologies (HCL IN) - Healthy operational performance - CSEC Research
L&T (LT IN) - Strong PAT growth aided by execution in Infra segment - CSEC Research
GlaxoSmithKline Pharmaceuticals - 1QFY2018 Result Update - Angel Broking
Dr. Reddy's Laboratories - 1QFY2018 Result Update - Angel Broking
Views on Lupin Ltd 1QFY2018 Results: Angel Broking
Tech Mahindra - 1QFY2018 Result Update - Angel Broking
Federal Bank - 1QFY2018 Result Update - Angel Broking
Margin expansion on the cards for SBI: Angel Broking
Views on Tech Mahindra Ltd 1QFY2018 Results: Angel Broking
Views on United Phosphorus Ltd 1QFY2018 Results: Angel Broking
Result Update: Blue Dart Express (BDE) - BUY - TP Rs.5150
Result Update: Escorts Ltd - ACCUMULATE - TP Rs.710 - Kotak
Result Update: The India Cements Ltd - BUY - TP Rs.234 - Kotak


Website Created & Maintained by : Chennai Scripts
West Mambalam, Chennai - 600 033,
Tamil Nadu, India

disclaimer copyright © 2005 - 2017