- 06 May 2022
- ICICIdirect Research
P&G Health reports strong quarter with better marginsPGHL - 5282 Change: 57.85 (1.11 %)
News: P&G Health's Q3FY22 (July-June fiscal year) revenue increased by 22% YoY to Rs 268 crore. EBITDA margins improved by 1166 bps to 25.7% due to decline in marketing expenditure. EBITDA grew by 124% YoY at Rs 69 crore. Subsequently, Net profit expanded by 224% YoY to Rs 51 crore. Board of Directors of the company recommended an interim dividend of Rs 41 per equity share for FY22.
Views: P&G Health's revenues grew on back of 48%, 20% and 13% YoY growth in Respiratory, Gastro-Intestinal and Derma therapies respectively, while Top 5 brands (contributing ~ 57%) grew by 14% YoY, according to MAT March22, IQVIA. On growth front, company’s core therapy - VMS (65% of top-line) has lagged with the growth of 6% YoY on MAT March,22 levels compared to overall growth of 13% in 9MFY22. Despite high inflationary pressures on input cost, P&G Health in 9MFY22, is trending at 25.5% EBITDA margins mainly due to improved productivity and lower marketing spends. P&G Health possess MNC pharma traits like strong brand stickiness, growth, earnings visibility, strong b/s etc. The key differentiator for P&G Health is that its core category is VMS and amid increasing demand for daily supplementation, company is focused on executing its strategy of offering superior brands, driving productivity, increasing reach, and improving awareness.