Sun Pharma Returns To Profit

Adjusted net profit rose 36% at ₹2,155.9 crore in the three months ended March after excluding exceptional items.

The reported and adjusted net profit surpassed consensus analysts’ estimate of ₹1,960 crore in a Bloomberg survey. Shares of Sun Pharma gained on the news, rising 2.84 %. The stock was the second largest gainer among Nifty 50 stocks during the day.

The performance was driven by a strong ramp up in its specialty portfolio in the US and global markets, and supported by strong growth in the domestic formulation business and other emerging markets.

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Revenue grew 14% to ₹1,0725.6 crore in the quarter.

US formulation sales at $430 million for Q4 marked a growth of 10.5% over a year earlier, comprising about a third of total consolidated sales. This was despite US unit Taro Pharma’s Q4FY23 sales growing at just 2.3% at $147 million in Q4. Taro’s net profit of about $6.9 million also was lower by 75% over adjusted net profit of Q4 last year. In rupee terms, US sales at ₹3,534.32 crore rose 21% helped by favourable currency movement.

Global specialty sales came at $244 million, including the $6.8 million milestone received during Q4. Ex-milestone, the global specialty sales accounting for 18% of Q4FY23 overall sales, increased 28% over Q4 last year. Sun Pharma’s domestic formulation sales that also contributed about a third of overall sales (31%) also supported overall growth. India formulation sales at ₹3,364 crore for Q4FY23 were up 8.7% over a year earlier.

The company said adjusting for covid-related product sales a year earlier, sales growth in Q4FY23 was 9.8%.

Emerging markets sales comprised about 17% of total consolidated sales for Q4FY23 at $ 221 million, a 7.5% rise.

The RoW (rest of world) market sales at $ 191 million for Q4FY23 also were up 7.4% y-o-y, accounting for approximately 14.7% of total consolidated sales for the quarter.

External API (Active Pharmaceutical ingredients) sales, however, declined 6.9% year-on-year to ₹385.2 crore.

The reported EBITDA at Rs. 28,02 crore was up 19.7% versus Q4 last year. EBITDA margin for Q4 at 25.6% improved from 24.8% for Q4 last year.

The company during the quarter has filed 3 ANDAs (abbreviated new drug applications). Additionally, its portfolio includes 54 approved NDAs while 13 NDAs await US FDA approval.

The company also completed the acquisition of Concert Pharmaceuticals, Inc during March’23.

“Acquisition of Concert helps further strengthen our portfolio in dermatology. I believe deuruxolitinib can become a leading product to address highly unmet need in alopecia areata patients", said Dilip Shanghvi, Managing Director.

Reported net profit for FY23 was Rs. 8473.6 crore compared to Rs. 3272.7 crore for FY22. Excluding the exceptional items, adjusted net profit for FY23 at Rs. 8645 crore was, up 12.8% over same period last year . Sales at Rs. 43278.9 crore were up 12.6% over same period last year

Dilip Shanghvi, Managing Director of the Company said, “I am pleased with well-rounded growth demonstrated in FY23 by the company. Several of our businesses including Specialty, India and Emerging markets have continued to progress well. Our Specialty business remains on growth path, and we are committed to continue scaling it up."

Updated: 27 May 2023, 12:55 AM IST