ABBOTT - Q1 FY21 (Unaudited – Cons.)
CMP: 16,200
Total income from operations 1,064 Cr
999 Cr (6.51%) YoY | 961 Cr (10.72%) QoQ
Year ending revenue: 4,093 Cr Vs. 3,679 Cr (11.27%)
Net Profit of 180.3 Cr
116.9 Cr (55.11%) YoY 110.9 Cr (63.53%) QoQ
Year ending Net profit: 588 Cr Vs. 450 Cr (30.54%)
EPS (in Rs.) 84.87
55.03 YoY | 52.22 QoQ
Year ending EPS: 279.04 Vs. 211
View: Strong result and above expectation. YoY revenue in quarter above 1K Cr and profit up in YoY and QoQ. EBITDA and margin both improved in this quarter.
Business Updates & Highlights:
Q1FY21 EBITDA is around INR 233.4 Cr Vs. 174.1 Cr in Q1FY20 Vs. 138.4 Cr therefore up by 33.9% in YoY and 68.9% in QoQ. EBITDA margin in Q1FY21 was 21.9% Vs. 17.4% in Q1FY20 Vs. 14.3% in QoQ.
Other expenditure declined by 36.1% in YoY.
The extended lockdown on account of COVID-19 pandemic has led to a slowdown of demand in some therapeutic areas and resulted in lower sales.
Financial
ROE and ROCE is around 24% and 37% respectively and book value per share is around INR 1,144 and share is currently trading at 14x of its book value. Company is currently trading at annualized PE) of around 54 which is average as per Industry benchmark. Promoter holding in the company is around 75 which is very strong and stable. FIIs and mutual fund hold around 1.3% and 5% respectively. The good thing is company is virtually debt free.
Position: Share strong support price is INR 14,900. Long term investor should continue with the company and any correction will give good opportunity to enter for target price of INR 20K.
Share View: Share price high 18,570 (52 week) and now 16,200. Abbott in India is one of the country’s oldest and most admired healthcare companies. Company provide consumers with a diverse range of diagnostics solutions, medical devices, nutritional products. Positioned as a market leader in pharmaceuticals, nutrition, devices and diagnostics, our key brands occupy the top positions in relevant categories
Opportunities
Strong R&D Units which more than 130 scientists conduct research and development to meet specific Indian needs. Over 400 branded Generic Pharmaceuticals in 80% of therapy areas at 5,000 pharmacies nationwide. 10 year average sales growth is more than 18% and profit growth is more than 22%. Consistently maintained ROE for past 10 years which is average around 25%. Abbott is a leader in providing antibody testing at larger scale on multiple systems which helped meet the needs of laboratories as they look to build the capacity. Good dividend pay to their shareholders and follow high standard corporate governance mode.
Risk
Stock is the costliest and expensive valuation as compare to Sanofi, Pfizer, P&G health etc.
Disclaimer: Views are shared based on market research and study and personal in nature. Others can take the different view and opinions. Please do the thoroughly study before enter or exit the shares.
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