Sun Pharmaceuticals rating – Buy- One-offs hit bottomline in Q4FY22
时间:2024-06-26 11:23:51 阅读(143)
Sun reported net loss of Rs 22.8 bn in Q4, mainly on one-offs of Rs 39.4 bn (Rs 37.2 bn of provisions related to settlement of antitrust litigation for valganciclovir, valsartan and esomeprazole, Rs 1.6 bn of provisions for settlement with various purchaser groups and Rs 563.5 m for restructuring of certain businesses). It also booked a one-off tax gain of Rs 764.2 m and FX gain of Rs 1.6 bn. Adjusting for one-offs and FX, PAT was Rs 14.2 bn (~19% below HSBCe). EBITDA margins at 23.1% fell 109bps y-o-y and 346bps q-o-q on input cost pressure and normalisation of expenses.
Traction continues for specialty sales: Global sales for the specialty products portfolio of $185 m grew ~33% y-o-y (+1% q-o-q) on strong traction in key brands Ilumya, Cequa, and Odomzo. Specialty sales in FY22 grew 42% to $673 m (13% of total revenues vs 7% in FY18). Global sales for Ilumya (incl. milestones and royalties) reached $315 m (+81% y-o-y). Winlevi (novel acne drug launched in Nov 2021) is seeing good traction and around 9K prescribing doctors (out of 15K) have prescribed it. We expect sales traction to continue for key brands on improving patient footfall (elective procedures are not yet back to pre-COVID-19 levels), better commercial execution and increasing market size.
Retain Buy rating: We remain positive on Sun’s efforts in the specialty products portfolio, which we believe will likely achieve Ebitda breakeven over the next 2-3 years, resulting in significant operating leverage. We assume specialty sales to be key driver of US sales, with sales CAGR of 17.2% for FY22-25e, while we assume base generic and Taro sales stabilising at current levels.
Sun plans to expand India sales headcount by 10% in FY23e to improve market coverage and de-clutter some marketing divisions. We assume its India segment sustaining above-market growth on new launches and better reach. The outlook remains largely steady for other segments (RoW, emerging markets, API, etc.) barring any short-term fluctuations. Post Q4, we adjust our estimates per current visibility leading to 3.3%/3.5% cuts in EPS for FY23/24e. Our TP is Rs 1,040 (from Rs 1,075).
下一篇:YearEnder 2023- As war chest opens up, its the season of M&A in media and entertainment industry
猜你喜欢
- Nifty to top 19500 or give up gains- See GIFT Nifty, FII data, F&O ban, crude, more before market opens
- Nifty to see buying above 17400, Bank Nifty may top 40100 this week; use Iron Butterfly for 20 Oct F&O expiry
- Nifty to soon hit 17890 if it holds above 17700; Tech Mahindra, Motherson Sumi among top stocks to buy
- Nifty to rise above 18,600 or see further correction- Check US stocks, Asia shares, FII activity, SGX Nifty, more
- Nifty, Sensex tank 2% on weak global cues, 15700 may act as crucial support; ‘buy quality stocks on dips’
- Nifty, Sensex jump 1
- Nifty to regain 18300 or slip in trade- Check 7 things to know before share market opens
- Nifty to witness buying above 17200, Bank Nifty may trade positive; use Short Straddle for 4 Aug F&O expiry
- Nifty, Sensex snap 4-day winning streak to end in red; ‘volatility to continue, accumulate stocks on dips’