- 07 Nov 2022
- ICICIdirect Research
Neogen reported numbers below our estimates
NEOGEN - 1488 Change: -27.30 (-1.80 %)News:
Sales grew 31% YoY to Rs148.1 crore (I-Direct estimate Rs 167 crore) driven by 122% growth in Inorganic Chemicals to Rs 49 crore. Organic Chemicals grew ~ 9% YoY TO Rs 99 crore. Gross margins increased by 350 bps YoY to 46.8% to Rs69.3 crores. OPM for the quarter fell by 170 bps YoY to 16.4% impacted by higher RMAT cost (+23% YoY) and other expenses (+63% YoY), leading to EBITDA growth of 18% YoY to Rs24.3 crore against our estimates of Rs30 crores. PAT was down by 12% YoY to Rs9.9 crores as against our estimates of 15.3 crores, driven by higher finance cost (+68% YoY) and taxes (29.4% v/s 22.1% in Q2FY22)
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Based on the recently incurred capex for phase 1 and 2 at Dahej, we expect the company to report strong growth in CRAMS and advance bromide intermediate. Foray into lithium electrolyte is likely to offer strong revenue visibility in the long run. We expect some quarterly gyrations on account of lag in commissioning and execution of orders. We will come out with a detailed report post concall with management
Impact:
Neutral