Hold Pfizer Ltd For Target Rs . 4505 - ICICI Direct
Follow us Now on Telegram ! Get daily 10 - 12 important updates on Business, Finance and Investment. Join our Telegram Channel
https://t.me/InvestmentGuruIndiacom
Download Telegram App before Joining the Channel
Margins upbeat but power brands yet to see uptick…
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
Q2FY23 Results: Pfizer reported in line numbers with growth in margins.
* Revenues were flat YoY at | 637.5 crore
* EBITDA grew 22.3% YoY to | 232 crore while EBITDA margins improved 658 bps to 36.3% due to lower employee costs trending VRS scheme
* PAT for the quarter was at | 122.2 crore (down 14.6% YoY)
What should investors do? Pfizer’s share price has grown ~1.08 x over the past three years (from ~| 4070 in November 2019 to ~| 4450 levels in November 2022).
* 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 | 4505 i.e. 30x P/E on FY24E EPS of | 150.2.
Key triggers for future price performance:
* Brands like Eliquis, Mucaine, Magnex, Corex-Dx e have shown uptick (MATSeptember 2019-22 CAGR) amid muted performance in Pfizer’s top brands like Becosules and Prevenar-13, which bodes well for more power brands
* Measured approach with de-focusing and hiving off of tail brands and focusing on core strengths areas like vaccines, pain management, VMS, GI and CVS
* Strong brand recall, consistent new product launches, volume growth in top brands and intermittent price hikes provide comfort on the financials front
Alternate Stock Idea: Apart from Pfizer, among MNC coverage we like Abbott.
* We continue to believe in Abbott’s strong growth track in power brands and capability in new launches on a fairly consistent basis
* BUY with a target price of | 21725
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
