Vaccine approval adds a new dimension to the domestic organization: CDH has received emergency use authorisation (EUA) for its plasmid DNA Covid-19 vaccine ZyCoV-D. The latter is the initially Covid-19 vaccine authorized in India for adolescents in the 12-18 years age group. The management expects to get started supplying the vaccine in India from Oct’21. Based on our conservative estimates, we count on CDH to ramp-up production to ~40million doses from Oct’21. We count on a 75:25 split among the government and private channel and a blended price tag of ~Rs 320/dose for FY22. We issue in an chance (NPV of Rs 12/share) from the Covid vaccine in our estimates for CDH. We continue to worth CDH’s base organization at 25x its 12-month forward P/E. We arrive at a combined TP of Rs 670/share. We retain ‘buy’ rating.
ZyCoV-D – First DNA vaccine in the world, authorized for adolescents as well: CDH has received an EUA from DCGI (Drug Controller General of India) for its Covid-19 vaccine ZyCoV-D – the world’s initially DNA vaccine to be authorized for humans. It is also the initially Covid-19 vaccine to be authorized for adolescents in the 12-18 years age group in India. It is a 3 dose regimen vaccine to be taken on the 0th, 28th, and 56th day and is administered via a needle-no cost device. CDH has also applied for a two-dose regiment of ZyCoV-D and is in discussions with the regulator on a future course of action. Interim efficacy of ZyCoV-D is 66.6% as tested on 81 patients. The final efficacy will be based on a information of 158 patients. ZyCoV-D has shown one hundred% efficacy against moderate and extreme illness soon after the second vaccine dose. It is to be stored at 2-8°C, but is also steady at 25°C for 3 months.
Valuation and view: We arrive at an NPV of ~Rs 12/share for the chance arising from the Covid-19 vaccine. We continue to worth CDH’s base organization at 25x its 12-month forward earnings to arrive at our TP of Rs 658.
We arrive at a TP of Rs 670, which includes the vaccine chance and retain our ‘buy’ rating.
Vaccine situation in India: To date, 456million people today (~50% of adults) have received at least one dose of the Covid-19 vaccine. The estimated population in the 12-18 years age group is ~250million. ZyCoV-D is the sixth vaccine to obtain EUA in India, soon after Covaxin, Covishield, Sputnik V, Moderna and J&J. The GoI expects 2.2billion Covid-19 vaccines to be readily available by CY21-finish.