In today’s briefing:
- ASX200 Index Rebalance: Telix Pharma to Replace Sydney Airport
- S&P/ASX200: Sydney Airport OUT Telix Pharma IN, and Lots of SYD For Sale
- BGH Lodges Application With The Takeovers Panel Over CapVest’s Bid for Virtus
- Takeda: Key Drugs Continue Growth and Upgrade to Guidance; Pipeline Progress Despite Recent Setbacks
- Universal Vision Biotechnology (3218 TT): 2021 Revenue Growth of 28% Is Outlier Amid COVID-19 Crisis
- Aarti Drugs: Growth Led by Price Hikes and New Capacity Addition
- Sun Pharma: Strong Performance on All Fronts; Specialty Buoyed
- Hester Biosciences: Muted Q3; Launches in Place for Momentum Pick-Up
- Ajanta Pharmaceuticals: Momentum in Branded Business Buoys Numbers
ASX200 Index Rebalance: Telix Pharma to Replace Sydney Airport
- Sydney Airport (SYD AU) will be deleted from the S&P/ASX 200 (AS51 INDEX) after the close of trading on 9 February and Telix Pharmaceuticals (TLX AU) will be included.
- There will be selling on Sydney Airport (SYD AU) from MSCI, FTSE and S&P/ASX trackers and there could be opportunities for arbs to buy below the offer price and tender.
- The recent institutional placement, share purchase plan and promoter selldown could put a lid on Telix Pharmaceuticals (TLX AU)‘s stock price heading into the index inclusion.
S&P/ASX200: Sydney Airport OUT Telix Pharma IN, and Lots of SYD For Sale
- The Sydney Airport ASX200 exclusion sets up with Telix Pharma replacing it, and two more likely changes – one each in ASX50 and ASX100.
- Telix as an inclusion is a known known. The others are too.
- Sydney Airport will end up seeing a LOT of stock for sale on 9 Feb at the close.
BGH Lodges Application With The Takeovers Panel Over CapVest’s Bid for Virtus
- BGH has filed an application with the Takeover Panel over, inter alia, Virtus Health (VRT AU) granting exclusivity to CapVest.
- This application is similar in nature to the one filed by APA Group (APA AU) last year after AusNet Services (AST AU) granted Brookfield exclusivity in a competitive bidding stoush.
- Virtus is currently trading at a gross spread of ~5.0% to the Scheme price, 3.6% to the Alternative Offer, and 1.8% above BGH’s terms.
Takeda: Key Drugs Continue Growth and Upgrade to Guidance; Pipeline Progress Despite Recent Setbacks
- Takeda announced 3QFY03/2022 results today. Reported revenue grew 7.7% YoY to JPY901.3bn (vs consensus JPY850.5bn) and OP declined 18.6% YoY to JPY116.5bn (vs consensus JPY115.6bn) due to divestitures.
- Revenue from Top 14 key drugs grew 21.2% YoY, while revenue from top-seller Entyvio grew 24.2% YoY during the quarter.
- Takeda has upgraded its previous guidance for full-year FY03/2022. The company continues to progress with drug development. Two of its products were approved during the last 6-months.
Universal Vision Biotechnology (3218 TT): 2021 Revenue Growth of 28% Is Outlier Amid COVID-19 Crisis
- Universal Vision Biotechnology (3218 TT), the largest vision care chain in Taiwan, reported 2021 revenue of TWD2.6 billion, reflecting y/y growth of 28% amid the COVID-19 pandemic.
- The company is on an expansion spree and aims to double its ophthalmic service centers in Taiwan by 2025 from 25 now. This will further boost revenue growth.
- With having the highest number of SMILE machines among competitors, the company is well-positioned to benefit from increasing refractive surgeries in Taiwan. SMILE is the latest technology for refractive surgery.
Aarti Drugs: Growth Led by Price Hikes and New Capacity Addition
- Aarti Drugs reported revenue growth of 19.7% YoY which stood above our expectations.
- The API segment grew by 22% while the Speciality Chemical segment reported a robust growth of 74% YoY
- We recommend HOLD with the target price of Rs 540/share.
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Sun Pharma: Strong Performance on All Fronts; Specialty Buoyed
- Sun is the world’s fourth largest specialty generic company with sales of US$3.8 billion and boasts of 43 manufacturing sites addressing segments like specialty products, branded generics, complex generics, pure generics and APIs.
- With a market share of 8.2%, Sun is ranked No. 1 in domestic formulations. It enjoys leadership position in 11 specialties based on prescription
- Target Price and Valuation: Valued at Rs 1075 i.e. 28x P/E on FY24E EPS of Rs 38.3
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.
Hester Biosciences: Muted Q3; Launches in Place for Momentum Pick-Up
- Hester is one of India’s leading animal healthcare companies & the second largest poultry vaccine manufacturer in the country
- It has a strategic presence in 30+ countries with key markets being India, Nepal and Tanzania.
- Target Price and Valuation: We value Hester at | 2780 (base business at Rs 2712 i.e. 38x FY24E EPS of Rs 71.4 + NPV of Rs 67.8 for Covaxin DS opportunity).
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.
Ajanta Pharmaceuticals: Momentum in Branded Business Buoys Numbers
- Ajanta Pharma is a focused player in branded, which constitutes ~70% of the overall sales which are spread across geographies including India
- As of FY21, overall exports: domestic formulations ratio was at 70:30
- Target Price and Valuation: Valued at | 2605 i.e. 26x P/E on FY24E EPS of Rs 100.1
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.
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