KUALA LUMPUR (Oct 17): Pharmaniaga Bhd (KL:PHARMA) could pay out up to 70% of its profit as dividends in its financial year ending Dec 31, 2026 (FY2026) after successfully exiting Practice Note 17 (PN17) status, according to MBSB Research.
The research house, in a note on Friday, said the pharmaceutical group has been optimistic about its turnaround in the first half of FY2025 (1HFY2025), supported by strong performance in its logistics and distribution segment, with stock-keeping unit volumes already surpassing the prior year.
“The group has the potential to pay dividends by FY2026, at approximately 50%-70% of its Patami (profit after tax and minority interests),” it noted.
MBSB added that Pharmaniaga expects 3QFY2025 results to improve due to higher government concessions, while 4QFY2025 may be weaker because of lower demand and reduced public sector purchases.
Nevertheless, Pharmaniaga is gearing up to commercialise its insulin products in the second half of 2026, following validation of all manufacturing processes and machinery at its biopharmaceutical plant.
Regulatory approval is still pending, but orders have already been placed, with human insulin securing RM3 million in tenders from teaching hospitals, MBSB said.
Vaccine production, including the PV13 vaccine, is expected to begin in 2027, while the hexavalent 6-in-1 vaccine is planned for 2028-2029, it noted.
The influenza vaccine, launched in March 2025, had generated RM1.5 million in sales by June and is expected to see further growth during the peak flu season in July-September.
Five new generic drugs introduced this year have earned RM750,000 as of June, with full-year contributions expected to reach RM3 million. Two new wound care products are expected to be launched in 3QFY2025, MBSB said.
MBSB maintained its 'buy' call for Pharmaniaga with a target price of 32 sen, citing strong government concession agreements, upcoming biopharmaceutical products, and potential growth from digitalisation, automation and warehouse optimisation.
The research house, however, remains cautious on the group’s Indonesian business and human insulin concession.
At the time of writing, Pharmaniaga shares were up one sen, or 3.8%, at 27.5 sen, giving the company a market capitalisation of RM1.8 billion.