Sun Pharmaceuticals Industries Ltd's Q1FY20 consolidated net profit rises 31.2% yoy to Rs1,387cr : Beats Estimates

The company’s consolidated revenue stood at Rs8,259.30cr, up 15.7% yoy and 17.2% qoq.

August 13, 2019 3:34 IST | India Infoline Research Team

Sun Pharmaceuticals Industries Ltd Q1FY20

Consolidated Results Q1FY20: (Rs. in cr)

Q1FY20 YoY (%)
Revenue 8,259.30 15.7
EBITDA 1,995.61 24.2
EBITDA Margin (%) 24.2 166
Net Profit (adjusted) 1,387.48 31.2
***EBITDA margin change is bps
Sun Pharma reported a good set of numbers for Q1FY20. Consolidated revenue grew by 15.7% yoy and 17.2% qoq to Rs 8,259cr against median consensus estimates of Rs8,162cr. EBITDA came in at Rs1,996cr, up 24.2% yoy and 96.3% qoq, against consensus estimates of Rs1,772cr. EBITDA margin expanded by 166bps yoy and 973bps qoq to 24.2%. Reported PAT grew by 31.2% yoy to Rs1,387cr against median consensus estimates of Rs1,101cr.
  • Revenue growth is likely to have been aided by Domestic, RoW and Emerging market revenues; qoq improvement is likely on impact on India business in Q4. Similarly, qoq margins have been aided by India business.
  • Margins on yoy basis were aided by favourable (gains) foreign currency (~200bps yoy) and lower employee cost (down 142bps yoy, % of sales). On qoq basis, employee cost (-362bps qoq), other expenses (down ~850bps qoq) and forex gain (~160bps qoq) aided EBITDA margin expansion.
  • Finance cost declined by 58% yoy to Rs57cr and depreciation declined by 13% yoy to Rs136cr.
  • India sales at Rs2,314cr, up by 8% yoy. For Q1FY20, the company launched 10 new products in the Indian market.
  • US formulations sales at USD424mn, up by 12% yoy. Growth was aided by a significant business of generic supply to a customer (started from Q4FY19). Taro posted revenue of USD161mn, up 4% yoy.
  • Emerging Markets sales at USD194mn, was flattish on yoy basis. The growth on yoy basis was impacted by cross currency (posted constant currency growth).
  • Rest of World (ROW) growth, up 56% yoy (to USD167mn) was aided by consolidation of Pola Pharma (Japan) business.
  • R&D investments at Rs422cr (5% of sales) compared to Rs500cr (7% of sales) for Q1FY19.

Technical View:

Sun Pharmaceuticals Industries Ltd is currently trading at Rs. 439.15, up by 17.25 points or 4.09% from its previous closing of Rs. 421.90 on the BSE.
The scrip opened at Rs. 422 and has touched a high and low of Rs. 444.80 and Rs. 420.80 respectively. So far 1,41,06,664 (NSE+BSE) shares were traded on the counter. The stock is currently trading below its 200 DMA.

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