Hyphen Pharma International - CGS-CIMB Research 2022-08-17: Positioning For Next Phase Of Growth

Hyphen Pharma International - Positioning For Next Phase Of Growth

  • Hyphens Pharma (SGX:1J5)'s 1H22 revenue of S$80.7m (+26.5% y-o-y/+30.0% h-o-h) was ahead at 55.6% of our FY22F estimate. All three segments observed y-o-y revenue growth, with specialty pharma principals and proprietary brands growing significantly at +44.7% y-o-y and +15.9% y-o-y to S$48.2m and S$10.8m, respectively.
    • Specialty pharma’s growth benefited from the consolidation of contribution from Novem’s acquisition in Dec 21, as well as robust organic growth (+12.0% y-o-y) with the reopening of operating markets like Vietnam and Singapore. Novem contributed S$9.2m to total revenue in 1H22.
    • Meanwhile, proprietary brands’ growth was propelled predominantly by Ceradan and Ocean Health.
  • Better operating leverage also led to higher net profit of S$6.2m (+44.6% y-o-y/+146.6% h-o-h), exceeding expectations at 76.8% of our FY22F estimate.
  • The launch of Hyphens Pharma’s Omega-3 in Vietnam and D-Vita in Malaysia laid the groundwork for growth of brands such as Ocean Health and Ceradan regionally, although brand-building could take some time. More product launches are expected for the rest of FY22F in regional markets, with crossing the hurdle of product registrations an important milestone that indicates the start of sales generation in new markets.
  • Hyphens Pharma announced that its distributorship with principal Biosensors International Technologies Ptd Ltd is expected to lapse by 31 Dec 22. According to management, the cardiology specialisation has been a laggard and Hyphens Pharma intends to exit the specialisation with this lapse.
  • We think Hyphens Pharma can sustain its revenue growth with an expanded portfolio, by tapping on levers such as introducing existing products into new markets, as well as potential product/business acquisitions. We thus lift our FY22F/23F/24F net profit forecasts for Hyphens Pharma by 36.1%/31.8%/27.2%. Reiterate ADD recommendation on Hyphens Pharma with a higher DCF-based target price of S$0.39.

Above is the excerpt from research report by CGS-CIMB.
Clients of CGS-CIMB may access the full report in PDF @ https://www.itradecimb.com.sg/.

TAY Wee Kuang CGS-CIMB Research | Izabella TAN CGS-CIMB Research | https://www.cgs-cimb.com 2022-08-17
SGX Stock Analyst Report ADD MAINTAIN ADD 0.39 UP 0.360

Previous report by CGS-CIMB:
2022-05-13 Hyphen Pharma International - Building Up The HYPe

Target prices by 2 other brokers at Hyphens Pharma Target Prices.
Listing of broker reports at Hyphens Pharma Analyst Report.

Relevant links:
Hyphens Pharma Share Price History,
Hyphens Pharma Announcements,
Hyphens Pharma Dividends & Corp Actions,
Hyphens Pharma News Articles


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