Cadila: More a COVID hedge in the near term

Cadila's India presence -- at about 45 per cent of sales -- is similar in size as the US business and provides better cash-flow visibility

Anubhav Sahu
August 12, 2021 / 11:55 AM IST
PRO Only Highlights
-  Quarterly performance largely backed by improved realisations
-  Medium-term triggers China plus and protectionist measures for tyre industry
-  Valuations not inexpensive; but improved medium-term outlook

Cadila Healthcare’s (CMP: Rs 563, Market Cap: Rs 57,713 crore) Q1FY22 result has underlined the return of higher-than-expected pricing erosion risk in the US market. A commentary across the sector is not favourable on this front, which leads us to evaluate how one should position for the stock. Q1 takeaways (image) Cadila posted a 15 per cent sales growth, led by a strong traction in domestic formulations (64 per cent YoY) and emerging markets (17 per cent YoY), partly offset by...