Mankind Pharma Q3 Results Review: Systematix Maintains 'Hold' On The Stock, Revises Target Price — Here's Why

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Systematix Research Report

Mankind Pharma Ltd. Q3 FY25 revenues (Rs 32,300 million, 23.9% YoY growth), Ebitda (Rs 8,298 million, 36.8% YoY Growth) and Net Income (Rs 3,802 million, -16.2% YoY) were below our estimates. The quarter witnessed integration of Bharat Serum Vaccine acquisition (67 days of sales during the quarter) and aided strong reported growth on a YoY basis.

However organic revenue growth was lower than expected owing to weakness in domestic branded prescription business (8% organic growth – excluding BSV), which was partially offset by strong growth in Domestic OTC business (30% YoY).

The organic growth in the branded prescription business was lower as Mankind Pharma is restructuring various divisions with a view to accelerate growth going forward. The changes involve the introduction of new leadership talent and realigning strategy with market realities.

A large part of the efforts have been implemented. Progress in BSV integration and aggressive product launches (organic and in-licensed) in chronic therapies are expected to support growth going forward.

We maintain Hold on Mankind with a revised target price of Rs 2,492 based on 35x PE multiple on FY27E EPS. We estimate revenue/Ebitda/PAT CAGR of 18.6%/23.5%/15.4% over FY24 to FY27E.

Mankind is addressing growth challenges in IPM through inorganic additions, but we expect the same to be margin dilutive in the near to medium term.

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