Zydus Wellness Q2 Review - A Forgettable Quarter; Focus Continues On Laying Building Blocks: ICICI Securities
Gross margins were down 490 basis points YoY due to sharp inflation in milk prices and weak product mix.
BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
ICICI Securities Report
Zydus Wellness Ltd. reported a decent (though below potential) top-line and volume growth prints of 12% and 5%, respectively. Gross margins were down 490 basis points YoY due to sharp inflation in milk prices and weak product mix.
Continued brand investments and higher other opex lead to dismal Ebitda margin print of 3.8%. We note that Zydus Wellness probably has higher distribution expansion benefit (compared to peers), which is not getting reflected in headline growth numbers.
With double-digit growth potential across its most brands, distribution expansion benefits and developments in focused international geographies are key legs of growth in the medium term. We like the new product development strategy aimed to address some key challenges.
Click on the attachment to read the full report:
This report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.