This Pharma Company Just Declared a 1,800% Final Dividend

The pharmaceutical sector has lost its mojo after a dream run during the Covid-19 pandemic.

Factors such as increased raw material prices, regulatory concerns, and price erosion in the generics business within the key US markets have contributed to the loss of momentum.

As a result, the Nifty pharma index has remained relatively flat this year, contrasting with the 2% gain in the Nifty 50.

However, considering the ongoing innovation, technological advancements, and scientific breakthroughs in the field, it is reasonable to anticipate exponential growth for pharmaceutical companies in the future.

These factors are expected to propel the growth of pharma companies in the future.

To further enhance investor enthusiasm, India's prominent pharmaceutical company has announced a massive dividend payout.

With an impressive track record, the company has distributed a total of 29 dividends since the year 2001, highlighting its consistent approach to rewarding shareholders.

The pharma company in question is none other than Abbott India.

#Massive dividend payout driven by robust Q4 results

Abbott India, on 19 May 2023, declared a final dividend of 1,800% or Rs 180 per share and a special dividend of 1,400% or Rs 145 per share, adding up to Rs 325 per share.

The record date for the same is 21 July 2023.

This was on the back of healthy results.

For the March 2023 quarter, the company's revenue stood at Rs 13.4 billion (bn), up 7% against Rs 12.5 bn in the corresponding quarter last year.

On the operating front, earnings before interest, taxes, and depreciation (EBITDA) came in at Rs 2.8 bn, down 4.6% YoY, due to elevated operating expenses.

The drug maker reported a 9.5% YoY rise in net profit at Rs 2.3 bn helped by strong sales in its mainstay pharmaceuticals segment.

In the corresponding quarter last year, the company posted a net profit of Rs 2.1 bn.

Abbott India's dividend history

The five-year average dividend payout ratio of the company stands at 61.4% while the dividend yield has averaged 1.4%.

Take a look at the table below to see Abbott India's complete dividend track record.

Year End	Dividend %	Dividend per Share(Rs)
31-Mar-22	2,750.00	275.00
31-Mar-21	2,750.00	275.00
31-Mar-20	2,500.00	250.00
31-Mar-19	650.00	65.00
31-Mar-18	550.00	55.00
31-Mar-17	400.00	40.00
31-Mar-16	350.00	35.00
31-Mar-15	310.00	31.00
31-Mar-14	230.00	23.00
31-Dec-12	170.00	17.00
31-Dec-11	170.00	17.00
31-Dec-10	170.00	17.00
30-Nov-09	170.00	17.00
30-Nov-08	140.00	14.00
30-Nov-07	175.00	17.50
30-Nov-06	175.00	17.50
30-Nov-05	175.00	17.50
30-Nov-04	350.00	35.00
30-Nov-03	350.00	35.00
30-Nov-02	120.00	12.00
30-Nov-01	100.00	10.00
31-Dec-00	450.00	45.00
31-Dec-99	405.00	40.50
31-Dec-98	65.00	6.50
31-Dec-97	80.00	8.00
31-Dec-96	65.00	6.50

Data Source: Ace Equity

Throughout its extensive dividend history, the company has demonstrated remarkable distribution stability.

In 2013 the annual payment amounted to Rs 17, while the most recent full-year payment reached Rs 275. This signifies an annual growth rate of approximately 32% over that period.

For more, visit Abbott India's dividend payout history.

Strong growth prospects

Going forward, the company plans to focus on a better product mix to offset raw material cost pressures.

Recognising the importance of technological advancements, the company is investing in new technologies and digital solutions.

This investment aims to enhance patient care and expand access to healthcare services, positioning Abbott India at the forefront of healthcare innovation.

With a robust portfolio of brands and the highest MR (Medical Representative) productivity among its domestic peers, Abbott India exhibits the ability to outpace market growth. This ability will be supported by an increase in prices and the introduction of new product launches.

In addition, it will use its healthy cash reserves for potential mergers and acquisitions in the consumer health and vaccine brands sectors.

This strategic allocation of resources will strengthen the company's growth potential and market position.

How Abbott India shares have performed recently

In the past one year, shares of Abbott India have gained 23%. So far in 2023, the stock has gained 2.7%.

But in the past five days, Abbott India is down 2.3%.

Abbott India has a 52-week high of Rs 23,140 touched on 10 April 2023 and a 52-week low of Rs 17,325 touched on 19 September 2022.

It is currently trading at a PE (Price to Earnings) multiple of 48.9x, while PB (Price to Book) ratio stands at 14.6x.

About Abbott India

Abbott in India is one of the country's oldest and most admired healthcare companies.

Abbott India is a subsidiary of Abbott Laboratories, a global healthcare company headquartered in the United States.

The company specializes in the development and manufacturing of a range of pharmaceutical products, including branded generics, vaccines, and medical devices.

The company has in-house development and medical teams to undertake product and clinical development tailored to the needs of the Indian market.

Abbott provides quality health care worldwide by creating healthcare solutions, which directly affect the life of the common man.

For more details, see the Abbott India's financial factsheet and latest quarterly results.

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