Healthcare

For our next Corporate Webinar with Siloam International Hospitals (SILO IJ), we are glad to welcome Daniel Phua, CFO, and Varun Khanna, Senior Director of Healthcare Business, Corporate Strategy, and Investments.

In the upcoming webinar, Daniel and Varun will share a short company presentation, after which they will engage in a fireside chat with Smartkarma Analyst Angus Mackintosh. A live Q&A session will follow.

The Corporate Webinar will be hosted on Tuesday, 21 June 2022, 17:00 SGT.

PT Siloam International Hospitals Tbk (ticker: SILO) is recognised as a reputable and leading operator of private hospital network in Indonesia, with 41 hospitals spread across several islands, namely Java, Sumatra, Kalimantan, Sulawesi, Bali, and Nusa Tenggara. Siloam’s medical team of more than 3,000 general practitioners and specialist doctors, and 8,000 nurses and support staff, offers international quality healthcare services to around two million patients annually.

Corporate Webinars by Smartkarma Corporate Solutions feature discussions with IROs and Executives, discussing their companies, the challenges they face, and the opportunities in their sectors and markets.

• The CARVYKTI commercialization will bring GenScript increasing revenue and cash flow. Together with the rapid growth of GCT CDMO, it is expected to see gradual improvement in GenScript’s financial performance.
• The complex international relations, geopolitical conflicts and anti-globalization risks could weigh on bullish sentiment in the short term or cause stock prices to fluctuate wildly.
• In the long term, GenScript’s “all-in” on GCT area enables it follow the industry trend closely. So,GenScript have the exponential growth potential in valuation, with possibility of surpassing WuXi Biologics.

• HCG’s continued focus on consolidation is leading to improving profitability.  Furthermore, with the normalization of post-COVID environment, elective surgeries and international footfalls are inching back to pre-COVID levels.
• Since the onboarding of CVC Capital as the majority shareholder, HCG’s capex discipline has been noteworthy. Capex is focused now on driving growth in existing centers vs opening new centers.
• We project HCG’s PAT to grow to INR 170cr+ by FY25. Valuing HCG at FY25 exit P/E of 47x suggests an IRR potential of 27% over the next 3Y.

• There are 18 changes to the SSE180 Index and 38 changes to the SSE380 Index that will be implemented at the close of trading on 9 June.
• There will be 9 deletions from the MSCI Standard Index and 22 deletions from the FTSE All-World/All-Cap indices at the close on 9 June.
• Currently, 16 stocks meet the threshold/are close for inclusion in the MSCI China Index while there are 38 stocks that meet the threshold for inclusion in the FTSE All-World/All-Cap indices.

• The most recent two quarters have maintained positive growth. It is of great significance for Huadong, who once suffered a significant decline and now in a critical period of transformation.
• The large growth potential of medical cosmetology and industrial microbiology would be important driver for future development. It’s also wise to strike a balance between current performance and future strategy.
• Huadong’s revenue growth would be above 10% in next few years. It would have higher valuation than Imeik. Investors are advised to follow Huadong. It could be a “dark horse”.

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

• Harding Loevner has been investing globally in high-quality, growing businesses based on disciplined industry research since 1989.
• Stock markets fell in the quarter, as the world watched in horror Russia’s invasion of Ukraine.
• China-based WuXi Biologics illustrates the perfect storm of macro issues pressuring the share prices of our rapidly growing companies.
• As questions mount whether globalization has reached a tipping point, companies are taking full advantage of the many advances occurring across the industrial automation landscape— propelling leadingp roviders of “Industry 4.0” solutions onto favorable growth paths.

• Inside is a recap of movements in the last week relating to the Shanghai and Shenzhen-Hong Kong Stock Connect facilities, broken down by company and industry. 
• Overall, net inflow was ~US$1.1bn, split evenly (roughly) between Shanghai and Shenzhen. 
• The largest inflows were into  China Mobile (941 HK) and CNOOC Ltd (883 HK). The largest outflows were in Kuaishou Technology (1024 HK) and BYD (1211 HK).

• Beauty Farm Medical and Health Industry (BFM HK), second largest body and skin care service provider in China has filed for IPO on the Hong Kong Stock Exchange.  
• Large and growing addressable market, comprehensive service offering, nationwide store network, and sound financial position are the major strengths of the company.
• BFM’s operation faces uncertainties over COVID and related restrictions. This IPO is not expected to see listing gain unless general market condition and China’s economic growth outlook improve.

• The Virtus Health (VRT AU) Board changed their recommendation that the BGH takeover offer rather than the CapVest offer is in the best interest of shareholders.
• BGH and CapVest represent 22.38% and 1.13% of outstanding shares, respectively. Press reports suggest that it is unlikely that CapVest will increase its offer (scheme: A$8.15, takeover: A$8.10).
• The BGH takeover offer of A$8.15 per share remains open until 31 May. At the last close price, the gross spread to the BGH takeover offer is 0.9%.

• Harding Loevner has been investing globally in high-quality, growing businesses based on disciplined industry research since 1989.
• Emerging Markets (EMs) declined sharply, primarily due to the collapse in Russian equities brought about by economic sanctions against Russia because of its invasion of Ukraine, as well as poor performance in China.
• The EM landscape is currently fogged by an exceptional confluence of risks: armed conflict in Ukraine, inflation, rising interest rates, volatile commodity prices, and concerns about food and energy security.
• Although we made only a handful of transactions this quarter, the portfolio’s profile changed significantly because of the write-down of our Russian holdings and the outsized returns of stocks benefiting from commodity price inflation.

• Dr Lal PathLabs Ltd (DLPL IN) reported 35% y/y revenue growth in its non-COVID business in FY22. Non-COVID realization per patient is also back to pre-COVID levels.  
• The company has acquired Suburban Diagnostics last year, which will further widen its geographical footprint, with western region contributing 24% of revenue from 10% earlier.
• There is a lot of noise regarding competition in the industry. Thus far, DLPL has not seen much pricing pressure and underpenetrated Indian diagnostic segment can accommodate more players.

• Upgrade to BUY from HOLD rating with an unchanged TP of B21.00, based on 14.36xPE’22E which is close to -2SD of 3-years trailing average.
• We see earnings trend to fall QoQ in 2Q22, as COVID-19 contribution fades in parallel with declining infection patients cases and dropped RT-PCR test for vaccinated tourists.
• We view profit trend to drop HoH in 2H22, as COVID-revenue normalizes YoY off high base in 2H21 based on our expectation government declares COVID as endemic in July.

• Imeik keeps its outstanding financial performance in 2021/2022Q1. On the surface, it looks prosperous, but its development strategy, product layout and resilience in front of risks would bring many uncertainties.
• Considering the pandemic/lockdown and a slowing economy in China, the revenue growth in 2022 could fall to about 50%, then to about 40% and 30% in 2023 and 2024 respectively.
• Imeik’s valuation is “unreasonably high”, which is expected to be lower than Bloomage in the future. Anything that deviates from fundamentals would inevitably return to the origin. 

• Otsuka Holdings (4578 JP) started 2022 on a strong note, with 13% y/y revenue growth in Q1. Growth was driven by four global products, which contributed 36% of total revenue.
• Otsuka has terminated its global license agreements with Akebia Therapeutics related to vadadustat for the treatment of renal anemia and recorded an impairment loss of ¥24 billion.
• Despite the impairment losses related to vadadustat, Otsuka reiterated 2022 guidance and expects double-digit growth in operating and net profits.

• Imugene Ltd (IMU AU) shares faced panic-selling after the announcement of termination of the company’s supply contract with Merck. However, the study will continue with alternative supply arrangement.
• Recently, Imugene published a letter to the shareholders describing the strength and near-term catalyst of the company, which provided some respite to the stock.
• Overall, Imugene, with a cash balance of A$109 million, is well-funded to advance its unique immune-oncology pipeline toward commercial success.

• With a little under two weeks until Virtus Health (VRT AU) shareholders vote on CapVest’s Offer, BGH bumps its off-market bid to $8.15/share, matching CapVest’s Scheme terms.
• BGH added it now holds 22.38% and will vote against CapVest’s Offer. Virtus has encouraged CapVest to respond today about whether they will increase terms. 
• With CapVest’s Scheme all-but blocked, BGH’s revised $8.15/share Offer is now the highest offer for Virtus.

• HK inno.N (195940 KS)‘s K-CAB induces faster onset of action and can control gastric pH for a longer period than the existing treatments in acid-related disorders.  
• K-CAB is expected to start global expansion in 2022. The drug obtained marketing approval in Philippines. It is already approved in China and is under clinical trial in the U.S.  
• HK inno has entered into marketing alliances with several Southeast Asian and Latin American countries. The company aims to export the drug to 100 countries globally by 2028.

• Botanee has outstanding performance at the current stage, but WINONA alone is not enough to establish a high moat. Its weak R&D/innovation in raw materials/products would cast doubts on outlook.
• Bloomage is more R&D oriented and characterized by integration of industrial chain. Its advanced synthetic biology will bring more possibilities for future development.The collagen would be a new growth point.
• Although with lower net profit margin, Bloomage is expected to have better outlook than Botanee. So, we think Bloomage could have higher valuation than Botanee in the future.  

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

• It’s understandable to take advantage of current market value and reserve capital in advance.Considering potential risks, how low the price of proposed issuance has to be to feel “safe enough”?
• Yingyi’s illegally reducing its holdings of WuXi AppTec could be a signal– Yingyi and other shareholders/executives are not confident in WuXi AppTec’s outlook, who may not regain its glory days.
• We recommend investors to view this proposed issuance rationally. If investors want to trade, a good strategy is to catch rebound after plunge, although the temporary rebound does not last.

• Dr. Reddy’s Laboratories (DRRD IN) reported 15% y/y growth in revenue in Q4, driven by strong performance across all the markets. Adjusted for one-offs, net profit grew 54% y/y.
• Despite pricing pressure, the U.S. business should continue its growth momentum with better traction in key products launched in FY22 and upcoming new launches, including generic version of Revlimid.
• Inflationary pressure (raw material, freight), lower offtake of COVID-related products in India, and currency headwinds in emerging markets are some downside risks for the company.

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

• Taisho Pharmaceutical Holdin (4581 JP) is the leader in the Japanese OTC drug market. The company’s Lipovitan, Pabron and RiUP brands capture top market share in their respective categories.
• With the re-opening of economy, increasing number of people are indulging in outdoor activities and consumer spending is recovering. These should boost Taisho’s OTC drug business.  
• The company’s prescription pharmaceutical business is well-positioned for long-term growth, driven by strong performance of existing drugs and upcoming new product launch.