Hyphens Pharma International

Price target: KGI Securities “outperform” 48 cents

‘Skin is the game’ with proprietary products push

Pharmaceuticals seller Hyphens Pharma International is moving beyond distribution for other brands and is growing the sales of its own proprietary brands.

Instead of developing them from scratch, the company has made acquisitions, such as the CG-210 hair loss treatment brand.

“Skin is the game — Asia-Pacific is the fastest growing region for the beauty market, and with new product releases in its two major brands Ceradan and Ocean Health, we expect the business to maintain double-digit growth, exemplified by the 23.7% y-o-y sales growth in 1H2020,” says KGI Securities Kenny Tan. On Nov 6, he initiated coverage with an “outperform” call and a target price of 48 cents, which is pegged to 17 times FY2021 estimated earnings.

Hyphens is also seen as an “appealing partner” for pharmaceutical brands looking to expand their presence in Asia. This is as the company has “built up a fair strong distribution network in Asia, with a direct presence in four emerging Asean markets”, he explains.

Aside from its product offerings, Hyphen’s presence on major e-commerce platforms Shoppee and Lazada has helped it reach out to customers, particularly during the lockdowns imposed to curb the spread of Covid-19 infections.

“Online penetration of beauty and personal care product sales is the highest in the Asia Pacific region, and we expect this to also contribute to sales for the proprietary brands segment,” says Tan. — Amala Balakrishner