MOSL: BIOCON (Neutral)-Strong traction in Biologics drives performance
Biocon: Strong traction in Biologics drives performance
(BIOS IN, Mkt Cap USD4.9b, CMP INR605, TP INR650, 8% Upside, Neutral)
- quarterly PAT at all-time high; momentum to continue in 2HFY19: BIOS’ revenue grew ~36% YoY to INR13.2b (est. of INR12.6b), led by strong growth in Biologics (27% of sales) and Research Services (32% of sales) businesses. Gross margin expanded ~540bp YoY/QoQ due to a superior product mix. EBITDA margin expanded ~690bp YoY to 25.7% (est. of 23.7%) on account of lower employee cost (-120bp YoY). On a QoQ basis, revenue/EBITDA increased by INR2b/INR1b due to a strong performance in Biologics. PAT grew 159% YoY to INR1.8b (est. of INR1.4b) adjusting for one-time profit, led by improved revenue growth and margins. BIOS had exceptional income on account of restatement of investment in Equillium (an associate) at fair value, which resulted in a gain of INR1.7b (net of tax). As a result, reported PAT stood at INR3.6b. For 1HFY19, sales, EBITDA and PAT stood at INR24.5b (+29% YoY), INR5.8b (+54% YoY) and INR2.9b (+92% YoY), respectively. We expect momentum to continue in 2HFY19 as well.
- Biologics, Research Services impress: Biologics segment (+132% YoY to INR3.6b) exhibited strong traction, with the launch of the pegfilgrastim biosimilar in the US and improved traction in biosmilars/insulins in emerging markets. Research Services (+32% YoY to INR4.2b) also performed well. Small Molecules segment grew 23% YoY to INR4.3b, led by a better product mix.
Biocon is an Indian biopharmaceutical company. Through its subsidiaries, Co. manufactures biotechnology products and is engaged in research and development in biotechnology. Co. provides a range of products from fermentation derived small molecules to recombinant proteins and antibodies. It has developed and taken a range of novel biologics, biosimilars, differentiated small molecules and recombinant human insulin and analogs from 'Lab to Market'. In research services, Co., through Syngene International Limited, is engaged in the business of custom research in drug discovery while the other subsidiary Clinigene International Limited (Clinigene) is engaged in clinical development.
Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.
Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.