🧭 At a Glance
Sequent Scientific Ltd, India’s #1 animal health pharma company, operates in 100+ countries with APIs, formulations, and R&D labs everywhere from Mangalore to Madrid. But with a P/E of 224, ROE under 4%, and five-year sales CAGR of just 5.6%… are we investing in pet care or just barking up the wrong tree?
1️⃣ What Do They Even Do?
At heart, Sequent is Alivira Animal Health — their 100% owned global animal health brand. Through Sequent and Alivira, they manufacture:
- APIs (Bulk Drugs): 32 commercial APIs, USFDA-approved
- Formulations: 1000+ dosage forms sold in 90+ countries
- Contract Research: Sequent Research Ltd (SRL), offering analytical services from a USFDA-certified lab
🌍 Global Footprint:
- Facilities: 5 for formulations, 2 for APIs
- R&D Centers: 5 (India, Brazil, Europe)
- Markets: Present across 5 continents
- Customers: Primarily in Europe (52%), LatAm, Turkey, and India
If your dog’s vaccine came from Spain, odds are Sequent made it.
2️⃣ Revenue Breakdown (Q1FY25) 🐐
| Segment | Contribution |
|---|---|
| Formulations | 76% |
| APIs & Others | 24% |
Formulation Markets:
- 🇪🇺 Europe: 52%
- 🌏 Emerging Markets: 40%
- 🇮🇳 India: 8%
Dogstem (Sweden), Flortekxin (Spain), and Syvazul (Benelux) are recent stars. But India contributes just 8% — so no, your local vet doesn’t move the needle.
3️⃣ Financials: Where’s the Growth?
📊 5-Year Financials (₹ Cr)
| FY | Sales | Net Profit | OPM | EPS (₹) |
|---|---|---|---|---|
| FY21 | ₹1,362 | ₹104 | 16% | ₹3.84 |
| FY22 | ₹1,413 | ₹45 | 8% | ₹1.65 |
| FY23 | ₹1,421 | -₹122 | 1% | -₹4.86 |
| FY24 | ₹1,370 | -₹30 | 4% | -₹1.44 |
| FY25 | ₹1,551 | ₹32 | 10% | ₹0.87 |
- Profit evaporated in FY23–24
- FY25 finally brought a recovery
- EPS collapsed 77% from FY21 to FY25
- Yet the stock is up 61% in 1 year. Retail ka faith is unshakeable 🙏
4️⃣ The Margin Resurrection?
OPM Trend:
- FY21: 16%
- FY22: 8%
- FY23: 1%
- FY25: 10% 👀
After two years of painful restructuring — shutdowns in Germany & Tarapur, ramp-ups in Vizag, streamlining in R&D — the margin is back.
Q4FY25 OPM = 12%.
Can they sustain it? Or is this just a quarterly cameo?
5️⃣ M&A Mania: Buy Now, Integrate Later 🧾
In the last 5 years, Sequent has made 8 acquisitions worth ₹400 Cr.
From LatAm poultry businesses to Turkish plants, they’ve gone full global.
But with that came:
- Bloated debt: ₹481 Cr in FY25
- Volatility in returns
- Restructuring fatigue
And now?
They’re merging with Viyash Lifesciences — expected to double scale & boost USFDA filings. Classic pharma move: “If we can’t grow organically, just absorb someone else.”
6️⃣ Return Ratios & Valuation Red Flags 🚩
| Metric | FY25 |
|---|---|
| ROE | 3.25% |
| ROCE | 8.97% |
| P/E | 224x (🤯) |
| Book Value | ₹28.1 |
| CMP | ₹198 |
| Price/Book | 7.04x |
Who’s paying 7x book for a company with 3% ROE?
🧠 “Buy the vision,” they say. But what about cash flow?”
7️⃣ KMP – Who’s Running This Global Zoo?
| Name | Designation |
|---|---|
| Manish Gupta | Managing Director & CEO 🧬 |
| Kiran Chintawar | Chief Financial Officer 💰 |
| Bhavana Doshi | Independent Director 🧾 |
Manish Gupta, the ex-Lupin exec, took over in 2014 and spearheaded Sequent’s animal health pivot via Alivira. He’s now aiming to make Alivira a top-10 global brand in animal pharma.
8️⃣ Shareholding & Sentiment
| Shareholder | % (Mar 2025) |
|---|---|
| Promoters | 52.61% (Steady) |
| FIIs | 6.05% |
| DIIs | 12.82% (Rising) |
| Public | 28.36% (Declining) |
Institutions are nibbling again. Retail is slowly walking away after years of red candles.
🧮 Fair Value Range
Let’s be conservative:
- FY25 EPS: ₹0.87
- Let’s assume FY26 EPS: ₹2.00
- Reasonable P/E for animal health biz = 25–30x
🎯 FV = ₹50 – ₹60
CMP is ₹198
Translation: You’re paying 3x fair value for hope, hype, and a healthy Golden Retriever.
TL;DR 🐶
- Global animal health play ✅
- 90+ countries, 1000+ formulations ✅
- Profit vanished for 2 years, now slowly recovering
- P/E = 224 → That’s not a typo
- Only invest if you believe in Alivira’s global dream
- Else, this dog is too pricey for its pedigree
Tags: Sequent Scientific Recap, Alivira Animal Health, Veterinary Pharma India, Pharma Turnaround Stocks, EduInvesting, CRO M&A Pharma, P/E Bubble Stocks, Global Veterinary Market India, Sequent Viyash Merger
✍️ Written by Prashant | 📅 17 June 2025
