Views on Sun Pharmaceutical Industries Limited 4QFY2017 Results: Angel Broking

Views of Ms. Sarabjit Kour Nangra (VP Research - Pharma, Angel Broking):

Sun Pharmaceuticals (CMP: INR 569 / TP: Under Review / Upside:)

"For 4QFY2017, the company posted tepid numbers. For the quarter, the sales came in at INR 6,825cr V/s INR 7,600cr expected, registering a YoY dip of 7.9%.

India sales at INR 1,916cr were up by 10% over 4QFY2016, US finished dosage sales at US$381mn down by 34% over 4QFY2016. Emerging Markets sales at US$181mn up by 46% 4QFY2016. Rest of World sales at US$109mn, growth of 38% over 4QFY2016 last year. This growth was partly driven by the consolidation of the Japan business.

On the OPM front, the gross margins came in at 67.8% V/s 80.4% in 4QFY2016, which lead the EBDITA Margins came in at 18.1% V/s 31.1% expected V/s 31.0% in 4QFY2016. Company's performance was impacted by the challenging generic pricing environment in the US.

In spite of the sharp dip, the high other income at INR 536cr V/s INR 185cr in 4QFY2016, lead the Adj. net profit, come in at INR 1,385cr V/s INR 1,433cr expected, a YoY dip of 19.2%. Other operating income for the quarter at INR 312cr included a milestone payment from Almirall S.A (Spain) as part of the licensing agreement for the development and commercialization of Tildrakizumab for psoriasis in Europe. We maintain our BUY rating on the stock, on back of valuations."

Shares of SUN PHARMACEUTICAL INDUSTRIES LTD. was last trading in BSE at Rs.568.55 as compared to the previous close of Rs. 591.8. The total number of shares traded during the day was 1248995 in over 15572 trades.

The stock hit an intraday high of Rs. 598.45 and intraday low of 564.9. The net turnover during the day was Rs. 718241819.

Source : Equity Bulls

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