Q1FY22 concall was today for ππ. My key takeaways ππ
1β£ Revenue & margin π»
In b/w lines:
Multiple factors for affecting both. Unit 3 has been commercialised, but not ramped up. Operating de-leverage at play. CMS revenue lumpy. As biz mix changes, so do margins.
1β£ Revenue & margin π»
In b/w lines:
Multiple factors for affecting both. Unit 3 has been commercialised, but not ramped up. Operating de-leverage at play. CMS revenue lumpy. As biz mix changes, so do margins.
https://twitter.com/sahil_vi/status/1403719236892061696
Some CMS revenue postponed due to complex nature of projects (more on that later).
2β£ Medium term guidance of 15-20% topline growth and 20% EBITDA margins
In b/w lines:
What we need to understand is that this is a very lumpy biz, even YoY there wont always be 15% growth.
2β£ Medium term guidance of 15-20% topline growth and 20% EBITDA margins
In b/w lines:
What we need to understand is that this is a very lumpy biz, even YoY there wont always be 15% growth.
Prices for Generic APIs are as per market movements. CMS revenues are lumpy. How can a management predict when will the Patent protected innovator molecule get commercialised? They simply cannot. With unit 3 ramping up & CMS revenue coming up, i fully expect 20% EBITDA margins
to be achieved in medium term (fuzzily defined). Expect to file 6-8 molecules in multiple geographies in rest of FY. Will drive revenue in GDS segment. Also aim to capture market share and constantly innovate on process side to bring down operating/manufacturing costs
3β£ CMS: the long and short of it:
In the short term, there will always be lumpiness. They are executing some very complex molecules with multi-step chemistry which involves in-process monitoring. Project timelines do not always align with quarterly boundries. Q1 CMS projects..
In the short term, there will always be lumpiness. They are executing some very complex molecules with multi-step chemistry which involves in-process monitoring. Project timelines do not always align with quarterly boundries. Q1 CMS projects..
have spilled over to Q2 and can spill over to Q3 too.
In the longer term: expect 4-5 CMS molecules to be commercialised in next 1-3 years. Entire CMS commercial segment is ~100cr right now. Some molecules can individually be as large as 100cr if successful. Wow.
In the longer term: expect 4-5 CMS molecules to be commercialised in next 1-3 years. Entire CMS commercial segment is ~100cr right now. Some molecules can individually be as large as 100cr if successful. Wow.
CMS biz will continue to be lumpy until it scales up to 300-400cr revenues.
My overall thoughts: this is a lumpy business overall. Investors should be prepared for quarterly results volatility, sometimes even year on year numbers volatility.
My overall thoughts: this is a lumpy business overall. Investors should be prepared for quarterly results volatility, sometimes even year on year numbers volatility.
Do you find this Q update useful? If so, please retweet the 1st tweet so that maximum ππ investors can read it and benefit.
β’ β’ β’
Missing some Tweet in this thread? You can try to
force a refresh
γ
