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Sun Pharma - 2QFY2016 Result Update - Angel Broking
Posted On : 2015-11-17 10:48:20( TIMEZONE : IST )
For 2QFY2016, Sun Pharmaceuticals Industries (Sun Pharma) posted results marginally lower than our expectations. Sales for the quarter, at Rs. 6,803cr (V/s Rs. 6,600cr estimated) dipped 15% yoy. On the operating front, the company posted an OPM of 27.9% V/s 38.0% in 2QFY2015 and V/s our expectation of 25.4%. The company had benefitted significantly in 2QFY2015 from the 180-day exclusivity on Valsartan tablets in the US, which resulted in a higher base for the quarter under review. Thus, the net profit came in at Rs. 1,107cr V/s Rs. 1,145cr expected and V/s Rs. 2,051cr in 2QFY2015, a yoy dip of 46.0%. Other income during the quarter came in at Rs. 225.6cr V/s Rs. 29.1cr in 2QFY2015. However, we are currently maintaining our target price of Rs. 950.
Results better than expected on the OPM front: For 2QFY2016, Sun Pharma posted results marginally lower than our expectations. Sales for the quarter, at Rs. 6,803cr (V/s Rs. 6,600cr estimated) dipped 15% yoy. Sun posted results marginally lower than expected. For 2QFY2016, the company posted sales of Rs. 6,803cr (V/s Rs. 6,600cr estimated), a dip of 15% yoy. Amongst the key marketsIndia (Rs. 1,819cr) posted a growth of only 1%, US (US$510mn) posted a degrowth of 28% yoy, Emerging markets (US$140mn) were down by 16% yoy and ROW(US$76mn) was down 30% yoy. On the operating front, the company posted an OPM of 27.9% V/s 38.0% in 2QFY2015. This was against our expectations of 25.4%. The company had benefitted significantly in 2QFY2015 from the 180-day exclusivity on Valsartan tablets in the US resulting in a higher base. Thus, the net profit came in at Rs. 1,107cr V/s Rs. 1,145cr expected and V/s Rs. 2,051cr in 2QFY2015, a yoy dip of 46.0%. Other income during the quarter came in at Rs. 225.6cr V/s Rs. 29.1cr in 2QFY2015.
Outlook and valuation: Sun Pharma is one of the largest and fastest growing Indian pharmaceutical companies. We expect its net sales to post a 9.3% CAGR (including Ranbaxy Laboratories) to Rs. 32,610cr and EPS to post an 8.4% CAGR to Rs. 26.9 over FY2015-17E. We recommend a Buy on the stock.
Shares of SUN PHARMACEUTICAL INDUSTRIES LTD. was last trading in BSE at Rs.753.35 as compared to the previous close of Rs. 740.3. The total number of shares traded during the day was 409193 in over 11564 trades.
The stock hit an intraday high of Rs. 756.5 and intraday low of 744.5. The net turnover during the day was Rs. 307532562.
