Sun Pharma gains after acquisition in Russia

Sun Pharmaceutical Industries rose 0.65% to Rs 694.20 at 9:50 IST on BSE after the company said it entered into an agreement to acquire 85.1% stake in a Russian pharmaceutical company JSC Biosintez for a total consideration of $60 million.

The announcement was made before trading hours today, 23 November 2016.

Meanwhile, the BSE Sensex was up 4.56 points, or 0.02%, to 25,965.34.

On BSE, so far 48,000 shares were traded in the counter, compared with average daily volume of 3.49 lakh shares in the past one quarter. The stock hit a high of Rs 696.65 and a low of Rs 691.55 so far during the day. The stock hit a 52-week high of Rs 898 on 23 February 2016. The stock hit a 52-week low of Rs 572.40 on 9 November 2016. The stock had outperformed the market over the past 30 days till 22 November 2016, falling 7.68% compared with the 7.87% decline in the Sensex. The scrip had, however, underperformed the market in past one quarter, falling 10.50% as against Sensex's 7.48% decline.

The large-cap company has equity capital of Rs 240.68 crore. Face value per share is Re 1.

Sun Pharmaceutical Industries (Sun Pharma) announced the execution of definitive agreements by its wholly owned subsidiary, for the acquisition of 85.1% of JSC Biosintez, a Russian pharmaceutical company engaged in manufacture and marketing of pharmaceutical products in Russia and CIS region. The equity consideration for the 85.1% stake is $24 million. Sun Pharma would also assume a debt of approximately $36 million as part of this transaction. Biosintez is a Russian pharmaceutical company focusing on the hospital segment with annual revenues of approximately $52 million for 2015. It has a manufacturing facility in Penza region with capabilities to manufacture a wide variety of dosage forms including pharmaceuticals for injections, blood substitutes, blood preservatives, ampoules, tablets, ointment, creams, gels, suppositories, active pharmaceutical ingredients (APIs), etc.

The transaction, expected to be completed by end of 2016, is subject to approval of the Russian Federal AntiMonopoly Service and other closing conditions. As per IMS (MAT September 2016), the Russian pharmaceutical market recorded sales of approximately $10 billion. The market recorded a growth of 7.4% in local currency terms as per IMS.

In a separate announcement after market hours yesterday, 22 November 2016, Sun Pharma said it received a letter from the Chief Financial Officer (CFO), Uday Baldota that he would be tendering his resignation as the CFO of Sun Pharmaceutical Industries to be effective with effect from in and around April 2017 due to his shifting to United States of America in and around April 2017 to look after the business of Taro Pharmaceutical Industries, a subsidiary of Sun Pharmaceutical Industries as its Chief Executive Officer.

On a consolidated basis, Sun Pharmaceutical Industries' net profit surged 117.25% to Rs 2235.14 crore on 13.21% rise in net sales to Rs 7764.03 crore in Q2 September 2016 over Q2 September 2015.

Sun Pharmaceutical Industries is the world's fifth largest specialty generic pharmaceutical company and India's top pharmaceutical company.

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