Syngene International Q2 Review - Higher Inventory Impacts Q2, Long Term Outlook Intact: Dolat Capital

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Dolat Capital Report.Syngene International Ltd. reported a 16% beat on earnings in Q2, adjusting for forex gain and one-off reversal of export incentive receivables of Rs 307 million, despite an in-line revenue growth aided by lower tax rates. Higher inventory stocking continue to impact Ebitda margins in Q2 as well. Margins came in at 27.4% versus our estimate of 26%. Syngene had procured higher inventory in last couple of quarters in-order to mitigate the logistical challenges. This coupled with higher contribution of Remdesivir (lower gross margin product) impacted margins at ~26% for H1 versus normal run-rate of 30-31%. In H1 FY22, company reported top-line growth of 35% YoY, driven by high contribution of Remdesivir (base revenue growth was in mid-teens). Our back of the envelope calculation suggests, Remdesivir contributed ~Rs 1.8-2 billion in H1.Management highlighted business normalisation in U.S. and EU and traction in complex projects such as peptide synthesis, PROTACS, etc. and remains confident of its growth trajectory in the medium term. .Click on the attachment to read the full report:.DISCLAIMERThis report is authored by an external party. BloombergQuint does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the brokerage and do not represent the views of BloombergQuint..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Syngene International Q2 Review - Higher Inventory Impacts Q2, Long Term Outlook Intact: Dolat Capital

Syngene International Q2 Review - Higher Inventory Impacts Q2, Long Term Outlook Intact: Dolat Capital

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