IGI Logo

Slowdown in key power brands impacts sales…

About the stock: Pfizer collectively addresses 15 therapy areas in domestic formulations with a portfolio of over 150 products that include therapeutics & vaccines. The company has been continuously restructuring its portfolio in the last few years to improve the productivity of its core brands.

* Fourth largest multinational pharma company in India

* Manufacturing facility in Goa with run rate of 1 billion tablets per annum

Q4FY23 Results: Margins in line but revenue missed.

* Revenue grew 4.2% to | 572.6 crore

* On the operational front, EBITDA grew 10% YoY to | 182 crore whereas margins grew 166 bps YoY to 31.8%

* PAT came in at | 149.2 crore

What should investors do? Pfizer’s share price has de-grown at 3.13% CAGR for the past three years.

* We maintain HOLD as we keep watch on uptick in power brands momentum post Covid impact and implications of the VRS scheme for the field force

Target Price and Valuation: Valued at | 3830 i.e. 26x P/E on FY25E EPS of | 147.2

Key triggers for future price performance:

* Addressing apparent slowdown in key brands like Eliquis, Becosules, Wysolone, Mucaine among others which, after growing decently since 2020, have slowed down in FY23

* Measured approach with de-focusing and hiving off of tail brands and focus on core therapies like vaccines, pain management, VMS, GI and CVS

* Traction in key power brands after the MR rationalisation

* Overall performance in the backdrop of key patent expiries, competition in Prevnar-13

Alternate Stock Idea: Apart from Pfizer, among MNC coverage we like P&G Health.

* Procter & Gamble Health is a leading pharma cum OTC company with key focus on vitamins, minerals, supplement (VMS). Its recent earnings reflect sustained efforts to regain momentum via improved mix and productivity initiatives

* BUY with a target price of | 5620

To Read Complete Report & Disclaimer Click Here

For More ICICI Direct Disclaimer http://icicidirect.com/disclaimer.html
SEBI Registration number is INZ000183631

Above views are of the author and not of the website kindly read disclaimer