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Duopharma’s profit momentum expected to continue

The Star·07/16/2025 23:00:00
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PETALING JAYA: Duopharma Biotech Bhd’s earnings trajectory for this year (FY25) is expected to be maintained as the pharmaceutical firm builds on momentum from FY24, analysts say.

CGS International Research (CGSI Research) projects the company to post earnings growth with a three-year core earnings-per-share (EPS) compounded annual growth rate of 19.8% over FY24 to FY27 following strong core net profit growth of 67% year-on-year in the first quarter ended March 31.

CGSI Research expects the earnings growth momentum to continue in FY25 driven by a full year’s contribution under the government’s Approved Products Purchase List contracts secured in April last year, a stronger ringgit versus the US dollar as well as lower prices for active pharmaceutical ingredients.

The research house has fine-tuned its EPS estimates for Duopharma’s FY25 to FY27 upwards after adjusting to reflect updated numbers from the company’s FY24 annual report.

It has also reiterated an “add” rating to the stock with a target price of RM1.74 after the stock’s 26% gain from a two-year low of RM1.11 on April 9 on a 13.4 times price-earnings multiple from the three-year pre-Covid-19 mean of 15 times in 2018.

The research house does not see incoming management changes, with the company’s managing director and chief financial officer set to retire by the end of the year, detracting from the mid-term goals, given the managing director’s position would be filled by Wan Amir-Jeffery Wan Abdul Majid, the current chief executive officer of group operations.

The company’s mid-term goals include finalising the product pipeline for a new facility to gain knowledge in developing and manufacturing new types of drugs and supplying them to the local market, optimising its existing Bangi and Klang facilities, putting in new production lines in a sterile facility.

It is also working out what products to produce in its production facilities and is exploring steroids and hormone products.