Sun Pharmaceuticals 3QFY2016 Results: Angel Broking

Views of Ms. Sarabjit Kour Nangra (VP Research - Pharma, Angel Broking) on Sun Pharmaceuticals 3QFY2016 Results:

Sun Pharmaceuticals (CMP: INR 848/ TP: INR 950 / Upside: 12.0%)

"Sun pharmaceuticals posted results much better than expected on the OPM front. The company posted sales of INR 7047cr V/s INR 7000cr expected in 3QFY2016, a YoY growth of 2.3%.

India sales are at INR 1,890cr, up by 8% YoY over 3QFY2015. Sales in the US were US $486mn for the quarter, a reduction of 11% over same period last year and accounted for 45% of total sales. Sales for the quarter were impacted primarily due to competitive pressure on some products and temporary supply constraints arising from remediation efforts at the Halol facility. The Company had partly benefitted in same period last year from the 180-day exclusivity on Valsartan tablets in the US resulting in a higher base. Formulation sales in Rest of World (ROW) markets excluding US and Emerging Markets were US $85mn in 3QFY2016, a de-growth of 6% from the corresponding quarter last year. Sales in emerging markets were at US $151mn for 3QFY2016, a decline of 7% from the corresponding quarter last year and accounted for 14% of total sales.

On the operating front, the Gross Profit margin, came in at 75.1% V/s 73.7% expected, enabling the OPM's to come in at 30.3% in 3QFY2016, V/s 25.6% expected and 30.8% in 3QFY2015.The R&D expenditure during the period was 8.3% of sales V/s 7.5% of sales in 3QFY2015. Thus, Adj. net profit came in at INR 1,417cr V/s INR 1,145cr expected a YoY growth of 258.3%. This was on back of 80% dip in tax expenses and another income of INR 254.7cr V/s a net loss of INR 29.6cr during the last corresponding period. Overall, we maintain our ACCUMULATE rating on the stock with a price target of INR 950."

Shares of SUN PHARMACEUTICAL INDUSTRIES LTD. was last trading in BSE at Rs.848.35 as compared to the previous close of Rs. 830.95. The total number of shares traded during the day was 619761 in over 18780 trades.

The stock hit an intraday high of Rs. 884.25 and intraday low of 803.55. The net turnover during the day was Rs. 526233867.

Source : Equity Bulls

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