 "Sun Pharma")
India’s largest pharmaceutical company, Sun Pharmaceutical Industries (Sun Pharma), posted a consolidated net profit of Rs 2,654.6 crore for the fourth quarter (Q4) of 2023-24 (FY24), up 33.7 per cent from Rs 1,984.5 crore. The company’s gross sales grew by 10 per cent to Rs 11,813.3 crore.
The board has proposed a final dividend of Rs 5 per share for FY24, in addition to the interim dividend of Rs 8.5 per share, bringing the total dividend for FY24 to Rs 13.5 per share, compared to Rs 11.5 per share for 2022-23 (FY23).
The board of directors also approved the appointment of Dilip Shanghvi, managing director of the company, as chairman of the board with immediate effect.
Sun Pharma’s stock ended the day’s trade on BSE at Rs 1,540.3, down marginally.
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The adjusted net profit (excluding exceptional items) for Q4FY24 was Rs 2,756.2 crore, up 27.8 per cent year-on-year.
Earnings before interest, tax, depreciation, and amortisation (Ebitda), including other operating revenues, was Rs 3,035.2 crore, up 8.3 per cent, resulting in an Ebitda margin for Q4FY24 of 25.3 per cent, compared to 25.6 per cent in Q4FY23.
Shanghvi said, “During FY24, two of our businesses surpassed $1 billion in annual sales, namely global specialty and emerging markets (EMs). This achievement of critical mass in key markets is a testimony to several years of hard work put in by respective teams. We shall continue to build our specialty portfolio and invest further to gain scale across our businesses.”
Shanghvi said that 2024-25 (FY25) is going to be an “investment phase” for several businesses, including product launches in the US and the ramp-up of the global specialty business.
He guided for high single-digit growth in consolidated top lines in FY25, with research and development (R&D) spend expected to reach 10 per cent of sales in the current year.
Regarding the outcomes of US Food and Drug Administration audits at Mohali and Dadra units, Shanghvi expressed confidence that the requisite corrective actions had been taken, which should be evident in subsequent audits by the US regulator.
India formulation sales were up 10.2 per cent to Rs 3,707.8 crore for the quarter under review, while US sales were up 10.9 per cent to $476 million.
Global specialty sales for the quarter were up 11.1 per cent to $271 million, accounting for 19.1 per cent of Q4FY24 sales.
EM formulations were up 10.8 per cent, and rest-of-the-world formulation sales were up 2.5 per cent.
Taro Pharmaceutical Industries, the soon-to-be wholly owned subsidiary of Sun Pharma, posted Q4FY24 sales of $165 million, up 12.5 per cent, with a net profit of $15.1 million.
R&D investments during the quarter were Rs 900 crore, compared to Rs 665 crore in the same quarter the previous year.
R&D spend was 7.6 per cent of sales in Q4FY24, with specialty R&D constituting 42 per cent of the total R&D spend.
For the full year, Sun Pharma reported a net profit of Rs 9,576.4 crore. The adjusted net profit (excluding exceptional items) for FY24 was Rs 10,070 crore, up 16.5 per cent.
Sales were up 10.4 per cent to Rs 47,758.5 crore, with India formulation sales growing 9.5 per cent, US formulation sales up 10.1 per cent, and global specialty sales up 19.3 per cent.
R&D investment for FY24 was Rs 3,177.6 crore, compared to Rs 2,367.6 crore for FY23.
Taro’s full-year FY24 sales were $629 million, up 9.8 per cent, with a net profit of $53.9 million, compared to $25.4 million in FY23.
Prathamesh Masdekar, research analyst at StoxBox, said that revenue growth was majorly led by the US market in the March quarter, with the global specialty business continuing to increase its share of overall revenues.
“The company continues building a specialty portfolio and investing further to gain scale across businesses. The company’s active pharmaceutical ingredient (API) business continues to focus on increasing API supply for captive consumption of critical products. We will keenly eye the management commentary on new product launches, US formulations (including Taro), business growth, specialty R&D pipeline, and domestic business. Further, the company will actively look for new investment avenues for growth across all business segments in the coming years,” he added.
