Zydus Wellness‘ acquisition of UK-based Comfort Click is aimed at expanding its product portfolio into the fast-growing vitamins, minerals and supplements segment in Europe and USA.
Ahmedabad- based Zydus Wellness is a well-established player in the domestic market with its portfolio of sugar-free products / sugar substitutes and health improving products like Complan and personal care products like Nycil.
The acquisition of UK-based Comfort Click for Pounds 239 million (nearly Rs 2,810 crore) or nearly 1.8 times its sales of pound 134 million for the year ended 30 June 2025.
Earlier, in March 2025, Zydus Lifesciences had acquired France-based Amplitude Surgical for Euro 256.8 (about Rs 2,380 crore) on a valuation matrix, enterprise value to sales for year ended June 2024 of nearly 3 times.
Meanwhile, the European market for vitamins and mineral supplements is estimated at Pounds 11 billion or $ 14.7 billion annually. It is understood that UK-based Comfort Click derives a large proportion of its annual sales from UK and European sales.
And it helped UK-based Comfort Click to grow its sales from Pounds 52 million (nearly Rs 610 crore) for year ended 30 June 2023 to Pound 134 million (nearly Rs 1,578 crore) for year ended 30 June 2025.
The acquisition was announced last week, Friday, August 29, and on Wednesday trade, intra-day the Zydus Wellness stock hit a 52-week high of Rs 2,350. The stock ended Wednesday trade nearly 3.4 % higher at Rs 2,330.
Zydus Wellness has also fixed September 18 as the record date for splitting its stock’s face value from Rs 10 to Rs 2.
Lackluster performance in the June 2025 quarter
Zydus Wellness’ consolidated revenue from operations grew 2.3 % y-o-y to Rs 861 crore in the first quarter of FY 26. The Ahmedabad-based company has highlighted unseasonal rains in different parts of the country during the June 2025 quarter and it impacted sales growth.
The company’s consolidated net profit declined nearly 13.4% y-o-y to Rs 127.9 crore in the June 2025 quarter, as the company faced a higher cost structure like raw materials consumed.
Valuations and outlook
Zydus Wellness trades at a P/E of more than 35 times estimated consolidated FY 26 earnings (excluding the acquisition of UK-based Comfort Click).
Other large players in the health and wellness segment like Dabur India also trades at a P/E of more than 35 times estimated consolidated FY 26 earnings. Godrej Agrovet trades at a P/E of nearly 30 times estimated consolidated FY26 earnings.
Clearly, stocks in this segment are quite expensive as compared to overall market valuations. Whether there is value on offer at these levels, only time will tell.
Disclaimer
Amriteshwar Mathur is a financial journalist with over 20 years of experience.
Disclosure: The writer and his family have no shareholding in any of the stocks mentioned in the article.
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