Takara Bio (4974 JP): FY23 Looks Uncertain as COVID-19 PCR Testing Number Decline Is Inevitable

Equity Bottom-Up

228 Views, 04 May 2022 18:38

EXECUTIVE SUMMARY

Takara Bio Inc (4974 JP) reported 55% y/y growth in revenue during the first nine months of FY22, mainly driven by 129% y/y surge in COVID-19 PCR test reagent revenue.
Although Takara Bio is likely to beat its FY22 guidance, uncertainty is prevailing for revenue earning potential beyond FY22, when the COVID-19 test demand will fade away.
We would stay away from this idea for now and wait on the sideline for a clarity of growth potential and recovery in the base business in FY23 and beyond.

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