Motilal Oswal's research report on Mankind Pharma
Mankind Pharma (Mankind) delivered in-line operational performance for 3QFY25. The earnings were below estimates due to higher interest outgo on debt raised to fund the BSV acquisition. While Mankind continues to deliver industry-beating growth in chronic therapies, regulatory headwinds in certain products and course corrections across the prescription (Rx) business affected the DF segment. Interestingly, the strategic reset has driven a healthy 30% YoY growth in the consumer health segment. We reduce the earnings estimate by 10%/6%/3% for FY25/FY26/FY27, factoring in: a) higher interest outgo, b) course correction to gradually revive growth prospects, and c) industry-level challenges in acute therapies. We value Mankind at 45x 12M forward earnings to arrive at a TP of INR3,050.
Outlook
We reduce our earnings estimate by 10%/6%/3% for FY25/FY26/FY27, factoring in a) the higher interest outgo, b) course corrections, which will gradually revive growth prospects, and c) industry-level challenges in acute therapies. We value Mankind at 45x 12M forward earnings to arrive at a TP of INR3,050.
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