2025-05-22-Jefferies-曼金德制药（MANKIND）_曼金德公司第四季度成本上升未达预期_为未来增长奠定基础_13页_680kb

Mankind Pharma 4Q Summary and Investment Outlook

Core Content

Mankind Pharma reported 4QFY25 results with revenue in-line with estimates at INR30.8bn, representing a 26% YoY increase and a 5% QoQ decrease. However, Adj. EBITDA was 8% below expectations at INR6.8bn, and PAT exceeded expectations by 19% due to the sale of a non-core asset. The EBITDA miss was attributed to a 7% QoQ rise in other expenses and one-time integration costs of INR250mn. Excluding these one-time costs, the EBITDA miss was 8%.

The company is undergoing restructuring and R&D investment, which are expected to support future growth. However, the FY26 EBITDA margin guidance was muted, indicating a flattish margin compared to expectations of a 100bps gain. This is due to increased R&D spend, which is projected to rise from ~2% of sales in FY25 to 3% in FY26. The ETR guidance remained unchanged at 21-22%.

Main Points

• Revenue Performance:

  • 4QFY25 revenue: INR30.8bn (+26% YoY/-5% QoQ)
  • FY26 revenue growth expected at 20%
  • FY27 revenue growth expected at 13%
  • FY28 revenue growth expected at 12%

• EBITDA and Margins:

  • 4QFY25 EBITDA: INR6.8bn (+16% YoY/-18% QoQ)
  • EBITDA margin fell to 22% due to higher selling expenses and BSV integration costs
  • FY26 EBITDA margin guidance: 26% (flattish YoY)
  • FY27 EBITDA margin guidance: 27% (expected to improve)

• Profit and EPS:

  • PAT: INR4.3bn (-10% YoY/+12% QoQ)
  • Diluted EPS: INR47.5 (down 9% from FY25)
  • EPS growth: 37% in FY27 and 25% in FY28

• Segment Performance:

  • India Rx:
    • Growth: 6% in 4QFY25 vs IPM growth of 7.3%
    • Chronic share reached 39%
    • Chronic portfolio growth: 11%
    • Growth impacted by price cap on Unwanted-72 and field force restructuring
  • Consumer Healthcare:
    • Growth: 14% YoY
    • Led by growth in Manforce, Gas-O-fast, and HealthOk
  • BSV Portfolio:
    • Integration costs impacted EBITDA
    • Expected to contribute to future growth

• Valuation and Price Target:

  • EV/EBITDA: 28x for FY27E
  • Price Target: INR2,870 (+18% from previous PT of INR3,300)
  • 12-month forward P/E: 30x
  • EBITDA growth is expected to be robust from FY27 onwards

• Investment Thesis:

  • Mankind is in a transition phase, integrating BSV, restructuring field force, and investing in R&D
  • The company is expected to deliver growth starting from Q2-Q3FY26
  • The investment recommendation is Buy, with the belief that the temporary challenges will lead to future gains

Key Information

• Key Metrics (FY2024A to FY2028E):

  • Revenue: INR103,348mn (FY2024A) to INR184,181mn (FY2028E)
  • EBITDA: INR25,351mn (FY2024A) to INR51,146mn (FY2028E)
  • Net Profit: INR19,129mn (FY2024A) to INR33,520mn (FY2028E)
  • EPS: INR46.4 (FY2024A) to INR81.2 (FY2028E)
  • EV/EBITDA: 41.8x (FY2024A) to 20.7x (FY2028E)

• Risks and Challenges:

  • Execution challenges with differentiated portfolio
  • Related party transactions
  • Fluctuations in the gamut of price-controlled products
  • Inability to generate synergy benefits from BSV acquisition

• Catalysts for Growth:

  • Continued outperformance in the India formulations market
  • Expansion in chronic, specialties, and super specialties
  • Scaling up of consumer healthcare brands
  • Price increases and stable raw material costs
  • Synergies from BSV acquisition

Investment Recommendation

• Rating: Buy
• Price Target: INR2,870
• Reasoning: Mankind is transitioning through a temporary rough patch, investing in R&D and restructuring, which are expected to lead to future growth. The company is among the best in class and is projected to deliver mid-teens growth in the consumer healthcare division from FY26 onwards.

Analyst Certification

• Alok Dalal and Dhawal Khut, both non-US analysts, certify that the views expressed in the report reflect their personal opinions and are not influenced by compensation. They are not registered with FINRA and may not be subject to certain regulations.

Valuation Methodology

• Price targets are based on multiple methodologies including market risk, growth rate, revenue stream, DCF, EBITDA, EPS, and EV/EBITDA. The current valuation uses a 28x EV/EBITDA multiple for FY27E.

Summary

Mankind Pharma is navigating through a period of restructuring and increased R&D investment, which are expected to lay the groundwork for future growth. Despite a 4QFY25 EBITDA miss due to elevated costs and integration expenses, the company's PAT exceeded expectations, driven by the sale of a non-core asset. The investment recommendation remains Buy, with a revised price target of INR2,870, reflecting the company's potential for growth post FY26. The company's core strengths in consumer healthcare and India formulations, combined with strategic initiatives, position it for long-term value creation.