OptiBiotix Health PLC (AIM:OPTI) has taken a significant step back towards growth, that is the view of stockbroker Cenkos, after the launch of a new weight loss product in India.
The GoFigure weight management range has been launched in partnership with Apollo Hospitals which has India’s largest pharmacy network.
Meal replacement shakes containing OptiBiotix’s Slimbiome prebiotic will be manufactured locally in India. In time, the company expects to further expand its product offering to include additional flavours and alternate products, like bars.
Initially the roll-out is expected in key Apollo stores within major Indian cities, as well as online.
Examining the market opportunity, Cenkos notes that Optibiotix sees a “market of great strategic importance”, being the world's second most populous and having an obesity prevalence in excess of 40%. A fast-expanding middle class is, meanwhile, expected to drive major growth in the nutraceuticals market, estimated to reach US$18bn by 2025.
Cenkos analyst Edward Jinks noted that the Apollo partnership was one of three large commercial deals struck by the OptiBiotix team in late 2021.
“We believe the launch with Apollo is a significant step in the company’s return to growth, expanding OptiBiotix’ reach into a substantial and fast-growing market,” Jinks said in a note.
Jinks pointed out that the other potentially large partnerships include the team-up with THG brand MyProtein, which has launched the ‘LeanBiome’ range into its eCommerce channels, and, Saudi Arabian firm Nahdi Medical which is planning a product launch before the end of this year.
More recently, Jinks highlighted, the company also inked a partnership with Nutraconnect, an APAC commercialisation partner, which he said “demonstrates OptiBiotix’ continued commitment to growing its brand presence on a global scale.”
“The [Apollo] launch demonstrates OptiBiotix’ strategic shift towards selling a greater proportion of finished, direct-to-consumer (D2C) products with larger partners, a trend we expect to continue with the Nahdi Medical launch before year end,” the analyst said.
“As outlined in the company’s recent trading statement, OptiBiotix expect normalisation of sales in H2/22 and a return to growth in 2023. We believe the launch with Apollo is a significant step in the company’s return to growth, expanding OptiBiotix’ reach into a substantial and fast-growing market," Jinks added.
In a statement, on Tuesday, OptiBiotix Ltd chief executive, René Kamminga, said: "We are very pleased that our GoFigure products are now available to the consumer in India through Apollo Pharmacies, a leading pharmacy chain in India.
“Our GoFigure range of weight management products have been specifically formulated to support consumers on a weight loss journey by reducing hunger and food cravings as well as modifying the gut microbiome in the direction of a lean person.”
The company’s consumer and healthcare products have been developed to modulate the human microbiome, a bacterial ecosystem that resides mainly in the gut. Its focus is metabolic syndrome and diabetes, systemic low-grade inflammation, obesity, cardiovascular disease, high cholesterol and healthy ageing.