ICICI Securities: Pfizer’s Cost Control Lifts Margin In Q1
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ICICI Securities Report
Pfizer Ltd. reported an operationally strong quarter in Q1 FY21. Revenue declined 5.4% YoY to Rs 5.1 billion (our estimate Rs 5.6 billion) impacted by divestment of two brands in Q3 FY20 and lockdown due to Covid-19.
Ebitda margin jumped 570 basis points YoY (up 1450 basis points QoQ) to 36.2% (highest in several quarters) with sharp fall in expenses. Adjusted profit after tax grew 10.3% YoY to Rs 1.2 billion (our estimate Rs 1.0 billion).
Revenue disparity between primary and secondary sales continues with all Indian origin chemists and distributors (AIOCD) data suggesting revenue growth of 4.1%.
We remain positive on the company’s growth visibility with exposure only in domestic formulations and strong balance sheet with deep cash reserves, however, pressure due to Covid-19 would restrict growth in the near term as the company’s product portfolio is largely acute (approximately 75%).
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