FDC Q1 Review - Strong Domestic Recovery: Centrum Broking
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Centrum Broking Report
FDC Ltd.’s Q1 FY22 numbers were well ahead of our estimates, with strong recovery in domestic acute market benefiting FDC.
Domestic revenue grew 61% YoY, driven by strong recovery in Zifi, Electral and Enerzal.
Export formulations declined 28% YoY and 25% QoQ to Rs 431 million (10% of sales).
Weakness in exports business was driven by U.S. sales being impacted by competition.
Gross margins were lower amid lower profit share from the U.S.
Meanwhile, Ebitda margins sustained at 26%, despite higher staff costs and other expenses sequentially due to improving domestic on-ground activities, driven by strong domestic margins.
We expect the domestic recovery to remain strong on a weak base while we watch closely the U.S. revenue impact from higher competition.
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