ICICI Direct's research report on Hester Biosciences
Q4 revenues grew 47.1% to Rs 64.2 crore due to 74.4% growth in poultry segment to Rs 52.7 crore as bird-flu incidences led to higher usage of preventive and curative poultry vaccines and health products. However, animal healthcare segment de-grew 11.6% YoY to Rs 11.5 crore. EBITDA margins, not comparable YoY due to pandemic impacted base, came in at 30.8% (16.5% in Q4FY20). EBITDA came in at Rs 19.8 crore, ~2.8x YoY. Adjusting for exceptional loss on Patan farm disposal, PAT came in at Rs 13 crore vs. Rs 2.7 crore in Q4FY20.
Outlook
Due to the recent stock run-up, we maintain HOLD and arrive at a revised TP of Rs 2870 (earlier Rs 1765) based on base business value of Rs 2758 at 40x FY23E EPS of Rs 68.9 + NPV of Rs 112 for Covaxin DS opportunity.
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