Ranvir’s Portfolio

Zydus Wellness –

Q1 FY 25 concall and results highlights –

Revenues – 839 vs 699 cr, up 20 pc ( volume growth @ 17 pc )

Gross margins – 55.5 vs 52.4 pc

EBITDA – 155 vs 116 cr, up 33 pc ( margins @ 18 vs 17 pc ). Other expenses were up 27 pc because of hiring of strategy consultant. Without this, other expenses would have only risen by 6 pc

PAT – 147 vs 110 cr, up 34 pc

Have repaid all their Debts. Company is now net cash cash positive

Company’s brands with their Mkt rank –

Sugarfree – No 1 – with 96 pc mkt share in sugar substitutes

Glucon D – No 1 – with 60 pc mkt share

Complan – No 5 – with 5 pc mkt share

ImLite – NA – new product category ( a unique blend of sugar + stevia )

Nycil – No 1 – with 35 pc mkt share in prickly heat powder

Everyouth – No 1 – in peel off masks and scrubs. No 5 in face wash

Nutralite – NA – has no organised peer in Fat spread category

Harsh summers in Q1 helped in the growth of seasonal products like – Glucon D and Nycil

Seeing a pickup in rural demand – lowering the rural – urban consumption gap

The personal care portfolio ( Everyouth + Nycil ) of the company saw a massive growth of 42 pc YoY !!!

Food and nutrition ( Sugarfree + Nutralite + Complan + Glucon D ) also grew strongly @ 15 pc YoY. Nutralite portfolio grew in single digits

Launched the following product extensions in Q1 –

Complan ImmunoGro – in select states

Everyouth Pink Clay, Charcoal infused anti pollution facewash, scrub and facewash

Nutralite – Tandoori Mayo spread

Nutralite – carrot and cucumber sandwich spread

Nycil soap with 4 variants in International Mkts. The 4 variants are – Aqua Mint, Neem and Aloe Vera, Lime and Sandal

Have lined up four more launches in the coming Qtrs

Company increased their A&P spends by 19 pc in Q1 ( to plough back some of the GM expansion gains )

Everyouth face scrub grew by 14 pc in Q1 and maintained its leadership position with 46 pc mkt share vs 43 pc YoY

Everyouth Peel off grew by 21 pc in Q1 and maintained its leadership position with 78 pc mkt share vs 76 pc YoY

Nycil prickly heat powder grew by 20 pc – led by harsh summers and continuous brand advertisements

Company intends to go back to 17-18 pc kind of EBITDA margins on a full year basis over the next 2-3 yrs

E-Comm now constitutes aprox 10 pc of company’s sales

Company has changed the formulation of SugarFree gold from Aspartame to Sucralose + Chromium. Chromium is known to reduce the blood sugar levels. This should help the company overcome the negative perception around Aspartame

Q2 and Q3 are generally slow for the company. 1/3rd of company revenues comes from these Qtrs. 2/3rd comes from Q1 and Q4. This causes loss of operating leverage in Q2+Q3 and hence the margins correct. However over the medium term, company is sticking to their 17-18 pc kind of EBITDA margins guidance for full FY

Company is confident of achieving double digit growth in topline for FY 25

Disc: initiated a tracking position, monitoring, biased, not SEBI registered, not a buy / sell recommendation