Sun Pharma gains in volatile trade after strong Q3 outcome

Sun Pharmaceutical Industries rose 0.6% to Rs 614.70 after consolidated net profit surged 73.73% to Rs 1531.09 crore on 51.59% increase in total income to Rs 4446.82 crore in Q3 December 2013 over Q3 December 2012.

Sun Pharmaceutical Industries declared the Q3 result during market hours today, 13 February 2014.

Meanwhile, the BSE Sensex was down 255.14 points, or 1.25%, to 20,193.35

On BSE, 3.16 lakh shares were traded in the counter compared with average volume of 1.32 lakh shares in the past one quarter.

The stock turned volatile after declaring Q3 result. The stock rose as much as 2.03% at the day's high of Rs 623.50. The stock fell as much as 0.16% at the day's low Rs 610.05. The stock hit a record high of Rs 650 on 10 October 2013. The stock hit a 52-week low of Rs 373.50 on 12 February 2013.

The stock had outperformed the market over the past one month till 12 February 2014, rising 0.22% compared with the Sensex's 1.49% fall. The scrip also outperformed the market in past one quarter, rising 2.16% as against Sensex's 0.82% rise.

The large-cap company has an equity capital of Rs 207.12 crore. Face value per share is Re 1.

Sun Pharmaceutical Industries' branded generic sales in India rose 20% to Rs 947 crore in Q3 December 2013 over Q3 December 2012. US finished dosage sales rose 57% to $434 million (in $ terms) in Q3 December 2013 over Q3 December 2012. International formulation sales outside US rose 16% to $84 million (in $ terms) in Q3 December 2013 over Q3 December 2013. Overall international revenues accounted for more than 75% of total revenues in Q3 December 2013.

Earnings before interest, taxation, depreciation and amortization (EBITDA) rose 57% to Rs 1975 crore in Q3 December 2013 over Q3 December 2012. EBITDA margin stood at 46% in Q3 December 2013 compared to 44% in Q3 December 2012.

The Active Pharmaceutical Ingredients (API) business has strategic importance for vertical integration on key products. A cumulative of 252 DMF / CEP applications have been made, with 172 approved so far. External sales of API fell 17% to Rs 174 crore in Q3 December 2013 over Q3 December 2012. The decline is mainly due to increased captive consumption of APIs, Sun Pharmaceutical Industries said.

Consolidated Research and development (R&D) expense stood at Rs 306 crore, or 7.1% of sales in Q3 December 2013.

In Q3 December 2013, Abbreviated New Drug Application (ANDA) for 5 products were filed. After counting these, and adjusting for filings that were dropped, cumulatively ANDAs for 468 products have been filed with the US Food and Drug Administration (USFDA) (as on 31 December 2013). ANDAs for 4 products received approvals in the third quarter, taking the total number of approvals to 337 (as on 31December 2013). ANDAs for 131 products now await USFDA approval, including 14 tentative approvals. The total number of patent applications submitted now stands at 534 with 342 patents granted so far, Sun Pharmaceutical Industries said.

Meanwhile, Sun Pharmaceutical Industries' revised upwards its consolidated revenue growth guidance to 29% for the year ending 31 March 2014 compared to previous guidance of 25%. The revised guidance takes in to account the performance achieved in nine months ended December 2013, higher base of Q4 March 2013 on consolidation of acquisitions as well the risks associated with increase in competition for some products. Guidance is at constant exchange rate, the company said.

Dilip Shanghvi, Managing Director of the Company said, Our overall performance reflects the focus on execution of our strategy. We are developing a differentiated and specialty business and continue to evaluate opportunities to enhance our global presence.

Sun Pharmaceutical Industries is an international specialty pharmaceutical company with over 72% sales from global markets. It manufactures and markets a large basket of pharmaceutical formulations as branded generics as well as generics in US, India and several other markets across the world.

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