ICICIdirect has maintained 'Buy' on Sun Pharmaceuticals with price target of Rs 1,036 as against current market price (CMP) of Rs 915 in its report.
Commenitng on the same ICICIdirect said, "The company's revenue stood at Rs 42.79 billion, down 8% YoY, lower than I-direct estimate of Rs 49.19 billion due to a decline in the US and RoW sales by 4.3% and 14.6% YoY to Rs 25.6 billion and Rs 4.44 billion, respectively.
The EBITDA margin declined 171 bps YoY to 44.7%, higher than I-direct estimate of 43.9% mainly due to better-than-expected Taro's margins. EBITDA declined 4.4% YoY to Rs 19.12 billion against I-direct estimate of Rs 21.58 billion. Net profit declined 8% YoY Rs 14.09 billion mainly due to lower sales.
With a market share of 5.45% the company is ranked one (standalone) in domestic formulations. The acute: chronic ratio stands at 44:56. It is leader in at least seven therapeutic categories, five of them are chronic therapies. Indian formulation growth was unaffected despite NLEM 2011 implementation vagaries and channel disturbances due to trade margin issues with wholesalers/distributors. We expect Indian formulations to grow at a CAGR of 17% to Rs 59.35 billion during FY14-17E.
Q3 numbers were affected by the supply constraints resulting from ongoing compliance adherence. Despite this the management has maintained its earlier revenue growth guidance for FY15. The US base business including Taro remains in a high growth trajectory as always and the Indian franchise continues to demonstrate robust growth. Going by the management's comment, it seems that the issues were one-offs."
Disclaimer: IRIS has taken due care and caution in compilation of data for its web site. Information has been obtained by IRIS from sources which it considers reliable. However, IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website.
