KYOWA HAKKO KIRIN - Divestment of the Chemicals Business Starts Paying Off on Bottom Lines
KHK’s 3Q FY 2011 earnings, which were marginally above our estimates on account of – 1) Better than expected improvement in margins after divesting chemical business, 2) Growth in pharma business backed by addition of a new subsidiary ProStakan group, and 3) Increased contribution from NESP franchise. KHK has already disposed off its food segment and chemical business, in future we can expect same with bio-chemical business. Separation of non-pharma segment will bring more stability to KHK’s pharma business and retain improved margins. Expected upside from proprietary Potelligent technology remains key catalyst for KHK – which is still a couple of years away from unfolding its value.
COMPANIES MENTIONED
KYOWA HAKKO KIRIN
KYOWA HAKKO KIRIN
