This small-cap stock rallied over 6 per cent on the back of stellar Q3FY23 results!

Karan Dsij
/ Categories: Trending, Mindshare
This small-cap stock rallied over 6 per cent on the back of stellar Q3FY23 results!

 The Fill-finish (Drug Product) project will be completed in Q1 FY24 as against the earlier forecasted date of Q4 FY23

Leading Animal Healthcare company, Hester Biosciences Ltd reported net profit of Rs. 12.16 crore for Q3FY23, rise of 46 per cent from Rs. 8.33 crore reported in the corresponding period last year. Revenue from operation for the quarter ended December 2022 were up 35 per cent to Rs. 74.94 crore as against revenue of Rs. 55.69 crore in the corresponding quarter last year. Operating Profit during the quarter reported growth of 18 per cent at Rs. 17.79 crore. EPS for the December 2022 quarter was Rs. 14.29 per share.

  • Consolidated results also include operations of subsidiaries at Nepal and Tanzania.
  • Hester Nepal had a turnover of INR 5.26 crore with overall Net Profit of INR 2.49 crore during Q3 FY 23.
  • Consolidated profit in Q3 grew with the improved profitability of Hester India, Hester Nepal and Hester’s share in the joint venture entity, Thrishool Exim Limited.
  • In Hester Africa, market authorization has been received from Tanzania Medicines and Medical Devices Authority (TMDA) for two important ruminant vaccines, Lumpy Skin Disease and CBPP.
  • Hester Nepal has received manufacturing license and marketing authorization for two additional vaccines, Live LASMAS and Inactivated Coryza+.                                                                                      

The stock rallied over 6 per cent on Tuesday and interestingly, the up-move was seen on back of highest single day volume in the since September 2022. Also, the stock moved above its 20-DMA and the daily 14-period RSI inching closer to 60-mark.

Going further
The Company’s focus on the various segments would be as follows: 
Vaccines:
1.    GoI has commenced its PPR disease national immunization program in sheep & goat. Hester being the supplier under the tender, the first supply of PPR vaccine was executed in January 2023. The total order value under the tender agreement is INR 40.68 crore which is to be fully executed by March 2024 in a phased manner as decided by GoI.
2.    With LSD as a new challenge in the cattle industry, we would be focusing on LSD awareness programs as well as would promote the annual immunisation against LSD through our Goat Pox vaccine. 
3.    Indian Veterinary Research Institute (IVRI) has developed vaccines against LSD in cattle and an Avian Influenza in poultry. Hester has entered into agreements to acquire both the technologies.
4.    With a view to drive growth in its core veterinary vaccines category, Hester has strengthened its R&D team and lab facilities to work on the development of certain conventional as well as new-age vaccines.


Health Products:
1.    The large market for Health Products for poultry as well as large animals is complementary to the vaccine market, given that these target the same customer segments in both the divisions. The company will continue to grow the health products business by increasing the field force, improving the productivity of the field force, and introducing new product to meet the unmet as well as the emerging market needs in both the divisions. 

Petcare division:
1.    Petcare Division, launched during the year is gaining traction. Until date, 10 products have been launched in 15 sales territories. The Company plans to launch additional 3 products in Q4 in the category of deworming and NSAID keeping the seasonal requirements in mind. 
2.    For the coming year, the Company is planning to launch new products and solutions, increase the field force from 20 currently to 60 in the coming months and add 25 new sales territories from 15, to penetrate further and drive sales growth.

 
Production and capacity expansion initiatives:
1.    The Fill-finish (Drug Product) project will be completed in Q1 FY24 as against the earlier forecasted date of Q4 FY23. The delay has been due to the late delivery of few equipment. This expansion, along with the already completed expansion of Bulk Antigen (Drug Substance) production capacity, will double the production capacity in vaccines. 

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