- 07 Feb 2022
- ICICIdirect Research
Advanced Enzyme reported below par performance this quarter and were below I-direct estimates.ADVENZYMES - 283 Change: 1.10 (0.39 %)
News: Revenues declined 3% YoY to Rs.133.6 crore on the back of 15.7% YoY de-growth in Human nutrition segment to Rs.91.8 crore being partially offset by growth of 25.7% YoY in Animal nutrition to Rs.13.2 crore. Bio Processing segment de-grew by 12.6% YoY to Rs.16 crore while Specialized manufacturing sales was at Rs.12.5 crore this quarter. EBITDA margins contracted 1147 bps YoY to 36.7% mainly due to higher raw material, employee and other expenditure. Subsequently, EBITDA de-grew 26.1% YoY to Rs.49.1 crore while net profit declined by 36.2% YoY to Rs.27.5 crore. Delta vis-à-vis EBITDA was mainly due to higher depreciation and lower other income being partially offset by lower tax.
Views:Advanced Enzyme reported below par performance this quarter and were below I-direct estimates. However quarterly gyrations notwithstanding, strong margins and healthy return ratios reflect the pricing power and balance sheet strength of the company. Going ahead, the management intends to augment its R&D capability for better facilitation and strengthening of in-house R&D capability, which bodes well in the long run in its quest to improve scalability and a possible foray into more complex enzymes and launch more products in target market of probiotics. We will get more insight post the conference call