Mutual Funds Commodities Research Tax Planning IPO Our Team Contact Us  
Google
Web www.equitybulls.com
Research

| More

JB Chemicals & Pharmaceuticals - Analyst meet takeaways - ICICI Securities

Posted On: 2021-03-03 08:49:35 (Time Zone: Arizona, USA)


JB Chemicals & Pharmaceuticals' (JBCP) hosted an investor/analyst meet for the first time after KKR took the controlling stake in the company. The focus of the management was clear on maintaining strong growth momentum coupled with profitability improvement. India business would remain key priority with an expectation of 12-14% improvement in MR productivity. R&D initiatives would enhance to support increased filings in US and strengthening of product portfolio across the businesses. We remain positive considering ~45% of total revenues and ~60% of EBITDA contribution is from domestic formulations with strong growth visibility coupled with focus on improving productivity, portfolio expansion and cost optimisation. Reiterate BUY.

- India business to remain key priority: India remains key focus area and would remain as the key growth driver in our view. Key highlights during the meet include 1) confident of outpacing industry growth and continued strong growth momentum in existing large products (Cilacar, Nicardia, Metrogyl, etc.), 2) launch products in new therapeutic categories like diabetes, pediatrics, respiratory, etc. 3) targeting 8-10 sizeable products across 4-5 therapies in medium term, 4) no intention to add MRs in the near term but work towards growing productivity by 12-14% annually from current base of Rs0.45mn/month, 5) open to look at acquiring brands or small companies.

- Focused approach across businesses in exports: The management has charted out business specific approach for exports without any major capex plans and growth would be driven from existing capacities. The key highlights were 1) R&D initiatives to increase in gradual manner but no aggressive plans for complex generics, 2) file 4-5 ANDAs per year (vs current 1-2) with focus on limited competition opportunities and Rising Pharma to remain as their marketing partner, 3) Russia and South Africa are like home markets with strong growth trajectory and more OTC launches would be targeted, 4) aggressively looking to expand CMO business in both lozenges and oral formulations, company has enough capacity, 5) currently JBCP has decent 4-5 products (diclofenac being the largest) in the API segment and it would look to add 4-5 more products over next 12-18 months with captive use to be the priority.

- Other highlights: EBITDA margin is higher in FY21 led by certain cost savings due to COVID-19 which is expected to reverse and may affect margin in FY22E. However, productivity improvement and cost efficiencies would support margins. There is no major capex requirement in near term and maintenance capex would be ~Rs700mn. The company would be looking to reinvest cash generation for augmenting growth and dividend payout may change depending upon reinvestment.

- Valuations and risks: We expect 11.7% revenue and 22.3% PAT CAGR over FY20-FY23E led by a healthy 13.1% CAGR in India business. We maintain BUY rating with a target price of Rs1,456/share based on 22xFY23E EPS. Key downside risks: Slowdown in India growth, pricing pressure and currency volatility.

Shares of J.B.CHEMICALS & PHARMACEUTICALS LTD. was last trading in BSE at Rs.1202.45 as compared to the previous close of Rs. 1202.5. The total number of shares traded during the day was 16999 in over 1378 trades.

The stock hit an intraday high of Rs. 1247.4 and intraday low of 1186.05. The net turnover during the day was Rs. 20739421.


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:

Nestle India 1QCY21 results - Views by Himanshu Nayyar, Lead Analyst - Institutional Equities, YES SECURITIES

ICICI Prudential Life Insurance - Q4FY21 Result Update - YES Securities

Power: Sector Thematic - Reforms essential for renaissance - HDFC Securities

ACC 1QCY21 Results Review Report - Strong margins! - HDFC Securities

ICICI Prudential Life 4QFY21 Results Review Report - Strong micro; challenging macro - HDFC Securities

ACC Ltd - Q1CY21 Result Update - YES Securities

ICICI Prudential Life Insurance - Business momentum upwards; valuations remain attractive - ICICI Securities

Multiplex - Business disruption again - learnings and better cash position to help - ICICI Securities

ACC - Strong show led by lower costs - ICICI Securities

Brookfield India REIT - Building a strong edifice - ICICI Securities

Q4FY21 Result Preview - Oil & Gas - ICICI Direct

Q1CY21 Result Update - ACC Ltd - ICICI Direct

ACC Q1CY21 Results - Views by YES SECURITIES

Comments on Rupee from industry experts - April 19, 2021

Autos & Logistics 4QFY21 Results Preview - HDFC Securities

ADD on Mindtree - Gaining momentum - HDFC Securities

ICICI Lombard 4QFY21 Result Review - HDFC Securities

Mindtree - Q4FY21 Result Update - YES Securities

ICICI Lombard - Q4FY21 Result Update - YES Securities

HDFC Bank - Q4FY21 Result Update - YES Securities

Mindtree - Subtle downgrade in outlook! - ICICI Securities

SBI Cards and Payment Services - Play on monetisable payments growth - ICICI Securities

ICICI Lombard General Insurance Company - Cyclical recovery can protract; fundamentals remain intact - ICICI Securities

HDFC Bank - Resilience and consistency displayed to its core - ICICI Securities

Home First Finance Company - Tech-led affordable housing play at affordable valuations - ICICI Securities

Q4FY21 Result Update - Wipro Ltd - ICICI Direct

ICICI Direct - Covid Recovery Pulse - E-Way bill generation ends March 2021 on strong note...

Derivatives Strategy - Positional Future - ICICI Direct

Gladiator Stocks - Escorts - ICICI Direct

Q4FY21 Company Update - Tata Metaliks - ICICI Direct

Q4FY21 Result Update - MindTree Ltd - ICICI Direct

Q4FY21 Result Update - HDFC Bank - ICICI Direct

ICICI Direct Derivatives Weekly View (April 16): Sustainability above 14700 may trigger fresh uptrend...

Market Outlook - Technical - By Dharmesh Shah, Head - Technical, ICICIdirect

Suman Chowdhury, Chief Analytical Officer, Acuité Ratings & Research, on Monsoon outlook

ADD on Wipro - Improving growth visibility - HDFC Securities

Building Materials 4QFY21 Results Preview - Strong demand to support robust margin - HDFC Securities

Consumer Discretionary 4QFY21 Results Preview - Bargains few and far between - HDFC Securities

Consumer Durables 4QFY21 Results Preview - HDFC Securities

Wipro - Q4FY21 Result Update - YES Securities

Suman Chowdhury, Chief Analytical Officer, Acuité Ratings & Research, on March 2021 Monthly Trade Balance

Wipro - Q4FY21 Result Update - Lofty multiples leave limited margin of safety - ICICI Securities

FMCG & Alco Bev 4QFY21 Results Preview - HDFC Securities

Maintain BUY on Infosys - Q4FY21 Results Review - Buy the dip - HDFC Securities

Suman Chowdhury, Chief Analytical Officer, Acuité Ratings & Research, on March 2021 WPI Data released today

Non-leveraged financials 4QFY21 Results Preview - HDFC Securities

Infosys - A reality check! - ICICI Securities

Infosys - Q4FY21 Result Update - YES Securities

Polymer price tracker - PVC prices continue to rise - April 15, 2021 - ICICI Securities

Bharti Airtel - Restructuring aimed at digital biz, AGR-tax efficiency - ICICI Securities


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

disclaimer copyright © 2005 - 2020