A woman prepares to take medication. PHOTO | FILE
Uganda’s stock market reopened in the new year with dealers eyeing the share price of drug maker Quality Chemicals Industries Ltd (QCIL), keen to raise its value by banking on pharmaceutical sales.
Despite its share price struggling since listing on the Uganda Securities Exchange (USE), observers say better projections of drug sales beyond Uganda could stand the firm in good stead. The drug maker, established in 2005 and listed on the USE in September 2018, manufactures antiretroviral drugs (ARVs) for the treatment of HIV/Aids, anti-malaria and hepatitis B drugs.
Analysts at Dyer and Blair Investment Bank of Kenya have issued a “buy” recommendation in favour of QCIL. They also projected its share price to jump from Ush63 ($0.017) to Shs194.90 ($0.05) over the next 12 months according to a research note published last month.
Dyer and Blair forecast a 16.5 percent growth in sales revenues generated from ARVs in 2025, which are anticipated to clock Ush185 billion ($49.7 million), a trend supported by a projected ARV treatment coverage rate of 91.6 percent for sub-Saharan Africa and higher export volumes.
But other factors could be influential.
Calvin Bateme, an equity research analyst at Crested Capital Ltd says the firm faces competition for drugs sale, which could affect interest in its shares.
“It could take another year for QCIL’s share price to exceed its initial public offering price of Ush256.5 ($0.07). This projection would be backed by less stagnation on its trading counter,” Bateme said.
“There may be demand for new drugs to treat diabetes and hypertension in Uganda, but at what price? The company has received product approvals from many countries but it may be stuck struggling with competitors in those markets.”
In November 2024, a sale transaction bearing 812,200 shares was executed on the QCIL counter at the USE, a scenario that saw the company’s share price fall from Ush70 ($0.019) to Ush52.5 ($0.014) according to USE records. In the first week of 2025, QCIL’s counter registered trading turnover of Ush1.46 million ($392.5), while its share price rose by 14.96 percent to Ush73 ($0.019).
Sales revenues from ARVs accounted for 59.9 percent of total company revenues in 2024, compared with anti-malaria drugs, which accounted for 38 percent. Sales revenues from hepatitis B drugs contributed 2.1 percent to the company’s revenues. Domestic product sales accounted for 64 percent of sales revenues, while export sales contributed 36 percent, the research note indicated.
The firm’s profit after tax is projected to expand by 23.8 percent this year to Ush39.3 billion ($10.6 million) on account of significant ARV sales.
In contrast, sales revenues from Anti-malarial drugs are forecast to decline from Ush100.9 billion ($27 million) in 2024 to Ush91.8 billion ($24.7 million) by end of 2025 on the back of falling malaria cases in Uganda and fierce competition posed by cheap drug imports sourced from Asia.
