Concord Biotech -
Company overview -
Company has a portfolio of 25 Fermentation based APIs. Company enjoys 20 pc global mkt share in 05 of the molecules that it makes
Manufacturing facilities at 3 places - all in Gujarat. All three are zero liquid discharge facilities. All are USFDA approved
Total installed capacity @ 1250 Meter Cube
Most of the APIs produced by the company are backward integrated to KSM levels
API portfolio primarily comprises of - Immuno-supressants, Oncology, Anti-Infectives and Anti-Fungal APIs
Company ventured into the formulations segment in 2016. Enjoys the benefits of backward integration. Company mainly operates in B2B segment for exports and domestic mkts with some B2C component only in the domestic mkt. Currently the company is only into oral solids. Going to foray into Injectables in near future
9M FY 24 financial outcomes -
Sales - 698 vs 580 cr, up 20 pc ( API revenues @ 562 cr, up 7 pc. Formulation revenue @ 135 cr, up 135 pc )
EBITDA - 302 vs 218 cr, up 39 pc ( margins @ 43 vs 37 pc )
PAT - 213 vs 148 cr ( margins @ 30 vs 25 pc )
Q3 FY 24 financial outcomes -
Sales - 241 vs 241 cr
EBITDA - 106 vs 112 cr ( margins @ 44 pc 46 pc )
PAT - 75 vs 79 cr
Concall highlights -
Company insists that there can be Qtr-Qtr lumpiness in its business performance due frequent changes in Customer’s order uptakes. Hence, its much better to judge company’s performance on a YoY basis
Aim to introduce 8-10 new API products over the next 3-4 yrs in the Oncology and Anti-Infective spaces
The injectable formulations facility is likely to start commercial production wef Q1 FY 25. Should start contributing meaningfully wef FY 26
9M revenues of the company are up 20 pc. Continue to aim to grow @ 25 pc CAGR for next 5 yrs ( this should mean higher growth in Q4 !!! )
Aim to maintain the API:Formulations sale split at 80:20 in near future
Initially - planning to launch 8-10 backward integrated Injectable formulations ( backward integration in these injectables should be a significant advantage )
02 of company’s API facilities are operating at capacity utilisations of 36 and 18 pc respectively ( indicating significant scope for positive operating leverage )
Majority of company’s exports are Air-Shipped. Hence the Red Sea issue is not such a big concern
Company has invested around 200 cr in their Injectables plant. Should be able to do 400-500 cr of sales from this facility in 4-5 yrs
Disc: initiated a tracking position, biased, not SEBI registered, inclined to add only on dips as valuations may be rich
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