Advanced Enzyme Q1 Results Review - Growth Driven By Overseas Markets: Nirmal Bang

Nirmal Bang Report

Advanced Enzyme Technologies Ltd.’s Q1 FY25 Ebitda came 10% lower than our estimates on account of lower revenue from the domestic Human Nutrition segment.

Despite a slow start, the management indicated revenue growth guidance of 12%-15% for FY25.

Since the largest product, Sera is expected to grow in mid-single digits, the rest of the Human nutrition portfolio needs to do the heavy lifting in order to achieve the overall revenue guidance in our view. Advanced Enzyme's Ebitda margin is expected to remain in the band of 33%-35%.

Also, consistency in core portfolio revenue growth and update on potential merger and acquisition remain key monitorables.

After rolling forward valuation to June-26E, we maintain Accumulate (20 times PE versus five-year median of 25 times) with an unchanged target price of Rs 400.

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