Pharma firms expect hike in revenue thanks to COVID-19

April 07, 2020 | 19:06
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A bit of a silver lining to the COVID-19 lockdown, major pharma firms expect to see visible growth in revenue this year.
pharma firms expect hike in revenue thanks to covid 19
Pharma stocks have gained traction during the global pandemic

Thanks to the COVID-19 pandemic, pharma stocks have been appealing for months now and have been the safest channel for investors. In the first quarter, DANAMECO (DNM) has recorded a hike in six consecutive sessions to hit VND26,800 ($1.17) per share – a 188 per cent increase against early 2020. OPC Pharmaceutical JSC (OPC) also rose 15 per cent, to VND50,000 ($2.17) per share.

As a result, most pharma firms forecast to receive record revenue this year. Notably, Imexpharm (IMP) set the turnover goal of VND1.75 trillion ($76 million), up 23 per cent on-year.

IMP has made plans in the first quarter to prepare back-up materials to manufacture enough products to meet the market demand during the epidemic. Regarding profit, the company expects to reach VND260 billion ($11.3 million) in pre-tax profit, up 28.4 per cent on-year.

Otherwise, Traphaco (TRA) also targets an increase of 17 per cent in revenue. Additionally, it set procit growth target at 5 per cent in profit, to make VND180 billion ($7.83 million). The company will focus on producing new pharma items in 2020-2025. This year, TRA intends to get the technology transferred from its partner Deawoong for 10-15 products. At the same time, it will keep searching and expanding its network of strategic partners to receive more transmissions and diversify items.

SPM Corporation (SPM), Pharmedic JSC (PMC), and Lam Dong Pharmaceutical JSC (LDP) expect growth rates at 1-8 per cent. Meanwhile, OPC foresees a plunge of 18 per cent in revenue and 31 per cent in profit. AMV, despite predicting a decrease of 8 per cent in earnings, hopes to get a 10 per cent hike in pre-tax profit, to earn VND245 billion ($10.65 million).

Besides, the two giants DHG Pharmaceutical Corporation (DHG) and Ha Tay Pharmaceutical JSC (DHT) estimate their revenue to remain stable this year. The latest report of Viet Capital Securities showed that the coronavirus outbreak may impact the input production lines of active pharmaceutical ingredients in China, resulting in the decline in the gross margin profit of DHG this year.

By Van Anh

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