By Modupe Gbadeyanka
Analysts at Cowry Asset have recommended the shares of Fidson Healthcare Plc to investors willing to add to their portfolio.
This is because the firm recorded a strong H1 2018 performance relative to its industry, judging by major financial ratios.
Fidson Healthcare Plc, a major drugs manufacturer in Nigeria, sustained its performance track record following a 11.50 percent increase in revenue.
This was enabled by its increased production capacity from its recently built world class WHO certified ultra-modern manufacturing plant capable of producing six distinct product lines which include: intravenous infusions and other sterile preparations, tablets, capsules, oral liquids, creams and ointments and dry powder.
The new plant, which has boosted its economies of scale, also positions Fidson to take advantage of the changing government regulations that aim to increase locally manufactured medicines to about 70 percent from current 40 percent of total medicines consumed in Nigeria.
The producer of essential drugs also benefited from the recent implementation of the 20 percent import adjustment tax (from 0 percent) against imported substitute drugs, which has enhanced the competitive edge of local pharmaceutical producers.
However, despite its impressive profitability indicators, Fidson also recorded mounting leverage while liquidity continued to thin out as CCC lengthened to 239.13 days (from 155.21 days).
Cowry Asset said regardless though, it expects the drug maker to remain a dominant player in the country and profitably so.
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