- 13 Nov 2024
- ICICI Securities
ZYDUS LIFESCIENCES Q2FY25- WELL-ROUNDED GROWTH WITH MARGIN EXPANSION
News: Revenue grew ~20% YoY to ₹ 5237 crore, driven by US, International formulations and Consumer wellness. EBITDA grew ~33% YoY to ₹ 1416 crore on the back of strong GPM improvement (increased ~564 bps to 71.9%). EBITDA margins improved 269 bps to 27%. Adjusted PAT increased 19% to ₹ 879 crore. US Formulations grew 26% YoY to ₹ 3093 crore, driven by volume expansion and new launches (4 new launches) besides exclusivity in gMyrbetriq (overactive bladder management) and continued traction from gRevlimid (anti-cancer). International Formulations grew ~20% YoY to ₹ 539 crore driven by growth across key markets. India Formulations grew 10% YoY to ₹ 1457 crore, driven by power brands and new launches (12 new launches including line extension). Consumer Wellness business grew ~12% YoY to ₹ 488 crore, driven by personal care segment and gradual recovery in food & nutrition segment.
Views: The company over the years has invested significantly towards scaling up of capability for niche and differentiated products. It is now bearing the fruits for the same with scores of niche launches across US, India and other geographies and more such launches planned over the next two-three years with calibrated R&D spend. We expect the launches that are planned are capable of filling the void created by wanning momentum of earlier launches. The company has specifically identified Rare and Orphan disease segment as the new growth opportunity in the future. Management’s upbeat guidance for revenues and EBITDA stems from the confidence in specialty and differentiated launches in the pipeline.
Impact: Positive