Daily Brief Health Care: Cipla Ltd, Shenzhen Mindray Bio-Medical Electronics, CEL-SCI and more

In today’s briefing:

Cipla (CIPLA IN): Strong Q4 Performance; Future Growth Drivers Being Added; Promoter Stake Sale
Shenzhen Mindray Bio-Medical Electronics (300760.CH) – Time to Bring “New Growth Story” To Investors
CVM: Confirmatory Study Clarity

Cipla (CIPLA IN): Strong Q4 Performance; Future Growth Drivers Being Added; Promoter Stake Sale

In Q4FY24, Cipla Ltd (CIPLA IN) posted 10% YoY revenue growth to INR61.6B. Despite surging R&D expenditure, EBITDA increased 13% YoY to INR13B, leading to 54bps margin expansion to 21.4%.
New launches in U.S. and outperformance in the domestic market driven by chronic portfolio should drive the growth. For FY25, the company has guided for EBITDA margin of 24.5–25.5%.
Cipla shares soared 15% YTD. Last week, the promoters, Hamied family sold 2.5% stake in the company for ~INR26B, igniting a rally in share price.

Mindray’s 2023 growth just hit the low end of our forecast.The good story that “recovery of routine diagnosis/treatment after COVID-19 would drive the growth of MI/IVD businesses” doesn’t hold water.
Mindray may fail to get back to 20%+ revenue growth in 2024 based on current situation.The Company has to continue to “buy revenue” so as to reverse the declining trend.
The valuation of about 25-30 PE is reasonable for Mindray, not undervalued. If PE falls to the range of 20-25, we think it is a good place to go long.

CEL-SCI is developing two platforms: Multikine and LEAPS. Multikine has completed a Phase 3 trial for head and neck cancer while LEAPS is conducting preclinical studies for RA, Pandemic Flu and breast cancer.
In June 2021, CEL-SCI reported selected data from its IT-MATTERS trial demonstrating a benefit in the non-chemotherapy population.
CEL-SCI plans to submit applications in the US, EU, UK and Canada.

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