Sun Pharmaceuticals Industries Ltd's Q4FY18 consolidated net profit rises 15.45% yoy to Rs1,552.31cr : Beats Estimates

The company’s consolidated revenue stood at Rs6,977.10cr, down 2.24% yoy but up 4.87% qoq.

May 25, 2018 04:05 IST India Infoline Research Team

Sun Pharmaceuticals Industries Ltd Q4FY18

Consolidated Results Q4FY18: (Rs. in cr)

Q4FY18 YoY (%)
Revenue 6,977.10 [2.2]
EBITDA 1,683.50 8.8
EBITDA Margin (%) 24.1 245
Net Profit (adjusted) 1,552.31 15.5
***EBITDA margin change is bps


Reco. Price


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Sun Pharma’ sales in Q4FY18 declined by 2.2% yoy to Rs6,977.1cr. EBITDA grew by 8.8% yoy to Rs1,683.5cr in Q4FY18. EBITDA margins were at 24.1% in Q4FY18 vs. 21.8% in Q3FY18 and 21.7% in Q4FY17. PAT grew by 15.5% yoy to Rs1,552.3cr in Q4FY18.
  • The quarter includes one-off, exceptional items, tax write back of Rs258.6cr on account of difference on tax and book value on intra-group transfer of certain intangibles. Adjusted for this one-off item, PAT would have been at Rs1,294cr, still ahead of the street estimate of Rs854cr for Q4FY18.
  • Sun Pharma’s gross margins improved by 619bps qoq and 539bps yoy, which is better than estimates. This indicates that the US portfolio is not witnessing harsh price erosion.
  • Sun’s subsidiary, Taro Pharma, in its March quarter results had reported gross margin decline by 535bps yoy to 67.9% in Q4FY18 and decline in Sun’s margins is lower than that of Taro.
  • Sun Pharma’s gross margins are best in the past six quarters, while EBITDA margins are best in the past five quarters.
Concall highlights
  • Sale of branded formulations in India for Q4FY18 was Rs1,963cr, up 2% yoy.
  • In the domestic business, company continues to have 8.5% market share.
  • Sales in the US declined 3% yoy to $368mn for Q4FY18.
  • Loss of exclusivity of Imatinib, overall pricing pressure in the US generics market and lower authorized generic sales impacted the growth.
  • Sales in emerging markets grew by 10% yoy to $199mn for Q4FY18.
  • Formulation sales in ROW markets grew by 6% yoy to $116mn in Q4FY18.
  • External API sales for Q4FY18 declined by 16% yoy to Rs332cr.
  • The Q4FY18 result was good due to better product mix and lower decline in gross margin of Taro.
  • Sun pharma has said that it will continue to focus on specialty products in the US markets.
  • US business and API saw pressure in the Q4FY18.
  • For FY19E, it expects revenue to grow in double digits and expects to sustain the margin level. It is expecting to launch three specialty products including Yonsa launch in Q1FY19E.
  • Company has said that it has hired people to ramp up its specialty products and expects that it can get fair market share in the specialty products.

Technical View:

Sun Pharmaceuticals Industries Ltd is currently trading at Rs. 466.55, up by 4.5 points or 0.97% from its previous closing of Rs. 462.05 on the BSE.
The scrip opened at Rs. 465.60 and has touched a high and low of Rs. 472 and Rs. 456.45 respectively. So far 53,40,773 (NSE+BSE) shares were traded on the counter. The stock is currently trading above its 200 DMA.

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