- 11 Aug 2022
- ICICIdirect Research
Zydus Lifesciences reports steady quarter, guidance to maintain marginsZYDUSLIFE - 482 Change: 3.65 (0.76 %)
News: Revenues grew 2% YoY to Rs 4073 crore mainly on back of 9% YoY growth in US business to Rs 1559 crore. Domestic formulations de-grew by 17% YoY to Rs 1125 crore while consumer wellness grew by 18% YoY to Rs 692 crore. Emerging markets expanded by 14% YoY to Rs 315 crore while APIs posted de-growth of 10% YoY to Rs 122 crore. EBITDA margins declined 383 bps to 20.5% mainly due to higher input cost and pricing pressure in US and higher employee benefit expenditure. Subsequently, EBITDA de-grew 14% YoY to Rs 833 crore. Adjusted Profit was down 11% YoY to Rs 529 crore.
View: Zydus Lifesciences Q1FY23 results were in-line with I-direct estimates. Ex-Covid related business, revenues grew 11% YoY this quarter. India formulations (ex-Covid: up 9% YoY) gained market share in key therapies like cardiovascular, gynaecology, respiratory and pain management, while consumer wellness business rebounded on the back of robust performance of summer heavy brands viz. Glucon-D and Nycil. On US front, business grew on the back of volume expansion and 8 new launches during the quarter. Company's plan to venture into complex injectables and incremental new launches bodes well. Similarly, addition of biosimilars (like Trastuzumab, Adalimumab, Pegfilgrastim, Bevacizumab, etc.) for emerging markets (like LatAm, MENA markets and South East Asia) is expected to provide growth impetus, going ahead. The wellness segment performance hinges upon the company’s marketing & distribution prowess while India formulations business is likely to stabilise and grow with market.