Natco Pharma Q2 Results Review - Strong Quarter, Pipeline Build-Up Underway: ICICI Securities

ICICI Securities Report

Natco Pharma Ltd.’s Q2 FY25 result was strong driven by gRevlimid. Cashflow generated from gRevlimid windfall is being used to develop new chemical entity, oligonucleotides and other complex products. Natco has a sole FTF on Ozempic (8mg/3ml and 2 mg/3ml) and Wegovy for US markets.

It may acquire an asset worth up to $300 million to fill in the gap created by loss of exclusivity in gRevlimid in FY27. Its crop science biz is incurring Ebitda loss of Rs 400-500 million p.a and will breakeven by March-26.

Management maintains 20% profit growth guidance for FY25. Net cash balance of ~Rs 26 billion has been earmarked for research and development (8–10% of sales), merger and acquisition and dividends. Raise FY25–26E EPS by 12–14% to factor in better sales of gRevlimid.

Maintain Hold with target price of Rs 1,430 on 20 times FY26E EPS of base biz and net present value value of Rs 250 for limited competition opportunities in U.S.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. NDTV Profit 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 author entity and do not represent the views of NDTV Profit.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.