Microsoft word - wyeth.docx

RESEARCH
Wyeth Ltd. DEFENSIVE BET
Key Indicators as on 09/05/2012 SOURCE:CMIE
Investment highlights:
Closing Price (Rs.) - TTM
EPS (Rs.) - TTM
BV per Share (Rs.) - TTM
Mkt Cap (Rs. Crore) - TTM
1,943.59
Beta - TTM
Mkt Cap/Sales (March -11)
Mkt Cap/PBIDTA (March -11)
Mkt Cap/PBDT (March -11)
Mkt Cap/PAT (March -11)
Mkt Cap/Cash Profit (March -11)
PBDITA Rs. in Crores TTM

Company Profile:
Face Value
Shares Outstanding crores
Laboratories (India) Ltd. on 20 September Equity Share capital in Rs. Crores
1947. The company is a subsidiary of Wyeth, USA and is promoted by Wyeth Share holding (%)
Promoters
USA and John Wyeth & Brother Ltd. UK. On 15 October 2009, the parent company Wyeth USA was merged with Wagner subsidiary of Pfizer Inc. Hence, Pfizer Inc. is now the the parent company of Wyeth USA and thereby of Wyeth Ltd. Products manufactured by the company includes antibiotics, women's healthcare products like oral contraceptives and depilatory creams, steroids, vaccines, vitamins, hematinics, products for cardiovascular diseases, central nervous system, transplantation, ophthalmology amongst others. Few of the popular brands owned by the company include Prevenar and Tygacil. It also owns the consumer healthcare brands like Anacin and Anne French. The manufacturing facility of the company is located at Goa. www.nayanmvala.com 
Investment Rationale:
Î Prevenar 13 the largest selling vaccines: Wyeth launched Prevenar
13 in Q4FY11 in the domestic market replacing its earlier version Contributes ~20%
Prevenar 7. This vaccine is effective against 13 variants of pneumonia to companies’ top
causing bacteria and is the market leader in its category. As per IMS line.
MAT-December 11, Prevenar 13 reported revenues of Rs289mn and grew at 248% on a low base. Prevenar 7 and Prevenar 13 have garnered revenues of ~Rs1.2bn in CY11 and hence is an important High margin
product for Wyeth contributing ~20% to its sales. Prevenar is the largest product.
selling vaccine in India. Prevenar 13 is a high margin patented product currently imported from Pfizer, US and is well received by pediatricians. Î Strong presence in OTC segment: Wyeth currently derives good
quantum of its revenues from OTC products. It markets two OTC Strong brands like
products namely: Anacin, an analgesic and Anne French, hair remover. Anne French and
Anne French is the market leader in its category. Wyeth has introduced Anacin.
Anacin Multi Pain as line extension in FY11. The company has plans to launch other OTC products from its parent’s portfolio. As well as it is a leading player in oral contraceptive (OC) markets and has a dominant Dominant player
market share. The company markets well-known brands namely: Loette in oral
(levonorgesterel and ethinyl estradiol), Ovral (levonorgesterel and ethinyl contraceptive
estradiol), Ovral-G (norgesterel and ethinyl estradiol), Ovral-L segments.
(levonorgesterel and ethinyl estradiol), Premarin (conjugated estrogens) used in hormone replacement therapy (HRT).We expect these products to be future growth drivers for the company. Î Strong parent company: The parent company Pfizer Inc. is the No.1
global pharma company with sales of $55.6bn (Rs2,750bn) and de-grew Pfizer Inc No.1
by 2.5% in 2010. In 2009, it acquired Wyeth for $68bn (Rs3,360bn) and global pharma
merged with itself. Pfizer is a research driven company and has spent company is its
13.9% of its revenues on R & D. Pfizer scientists have produced parent company.
innovative breakthroughs in a wide range of research areas including depression, high cholesterol, erectile dysfunction, HIV infection, hypertension, bacterial and fungal infections etc. Pfizer’s largest selling product Lipitor lost patent protection in Nov’11 resulting in a large dent in Merger with Pfizer
its revenues. Globally Wyeth has already merged with Pfizer except in on the cards.
India, where both subsidiaries are listed separately. Pfizer, US holds 70.8% in Pfizer India and 51.1% in Wyeth India. The operational merger between the two companies is complete but the legal merger is pending. Operational
For the legal merger, both companies have to appoint at least two merger in place
independent valuers for determining the merger ratio. After the valuation Mr. Kewal Handa
report is submitted, it has to be approved by the directors of both is the Managing
companies. This is then approved by the shareholders and creditors of Director of Pfizer
both companies. After all these approvals in place, it has to be filed with India and Wyeth.
the High Court for legal approval. This is a long-drawn out process and www.nayanmvala.com 
Î Debt Free Company: The company enjoys almost a debt free status
and has borrowings from its group or associate company as seen from Debt free status.
Î Strong growth post acquisition: The companies has strong financial
performance post acquisition by Pfizer Inc as seen from the table below: The company has Pre Acquisition phase:
been has been
growing at much
faster pace post
acquisition by
Pfizer Inc which
currently stands PBDITA net of
in the range of 10-
11% when
compared to its NFOI
pre acquisition
which was in the NFOI
range of 4 – 5%.
Post Acquisition phase:
The bottom line PBT net of P&E NFOI
grows faster than
the top line
growth.
Î Strong Dividend history: The company has strong dividend payment
Average dividend
rate of 225% since
the past 6 years.
Peer Comparison: Below is the comparison of Wyeth with its peers:
Better placed
when compared to
its peers.
www.nayanmvala.com 
 
Quarterly Results – (Standalone)

From NAYAN M. VALA SECURITIES PVT.LTD.RESEARCH
By Harsh B. Chauhan
Disclaimer: The information contained herein is confidential and is intended solely for the addressee(s). Any unauthorized access; use,
reproduction, disclosure or dissemination is prohibited. This information does not constitute or form part of and should not be construed as,
any offer for sale or subscription of or any invitation to offer to buy or subscribe for any securities. The information and opinions on which this
communication is based have been complied or arrived at from sources believed to be reliable and in good faith, but no representation or
warranty, express or implied, is made as to their accuracy, correctness and are subject to change without notice. NAYAN M. VALA
SECURITIES PVT.LTD. and/ or its clients may have positions in or options on the securities mentioned in this report or any related
investments, may affect transactions or may buy, sell or offer to buy or sell such securities or any related investments. Recipient/s should not
consider this report as only a single factor in making their investment decision. Neither NAYAN M. VALA SECURITIES PVT.LTD. nor any of
its affiliates shall assume any legal liability or responsibility for any incorrect, misleading or altered information contained herein.
MEMBER: NATIONAL STOCK EXCHANGE OF INDIA LTD MEMBER: THE CALCUTTA STOCK EXCHANGE ASSOCIATION LTD NAYAN M. VALA SECURITIES PVT.LTD. Tel: (+91-22) 2610 5973 / 2610 5974
403-404, Cosmos Court, Fax. +91-22- 2612 4310
Above Waman Hari Pethe Jewellers
S. V. Road, Vile-Parle (West), Website: www.nayanmvala.com Mumbai – 400056. INDIA www.nayanmvala.com 

Source: http://www.nayanmvala.com/pdf/Wyeth.pdf