Sun Pharma Q1 results: Profit zooms 40% on robust global specialty sales

On a sequential basis, the company exhibited a 6.8 per cent rise in net profit, while its revenue grew by 5.5 per cent, from Rs 2,655 crore and Rs 12,380.7 crore reported in Q3 FY24, respectively

India’s largest domestic drug maker Sun Pharmaceutical Industries on Thursday reported a 40 per cent year-on-year (Y-o-Y) rise in consolidated net profit for the June quarter of the current financial year (Q1FY25) at Rs 2,836 crore, up from Rs 2,026 crore reported for the same period last year. The company's total revenue from operations stood at Rs 12,653 crore, a 6 per cent Y-o-Y rise from Rs 11,941 crore reported in Q1FY24.

However, Sun Pharma stock was down 0.1 per cent in the afternoon trade on BSE. Brokerages had expected the revenue growth at around 8 per cent and profit growth in the range of 27-30 per cent. The results have thus beat Street estimates.
 

On a sequential basis, the company exhibited a 6.8 per cent rise in net profit, while its revenue grew by 5.5 per cent, from Rs 2,655 crore and Rs 12,380.70 crore reported in Q4FY24, respectively. At the operating level, the earnings before interest, tax, depreciation, and amortisation (Ebitda) rose 8.3 per cent to Rs 3,608 crore in Q1FY25, including other revenues. The Ebitda margin improved  to 28.5 per cent from 27.9 per cent during the same period last year.

 

Sun Pharma Chairman and Managing Director (CMD) Dilip Shanghvi said that the company has recently attained several milestones, with the approval of Leqselvi in the US, filing of Nidlegy in Europe, and the completion of acquisition of Taro minority shares. “These steps will advance our innovative as well as generic business offerings, and will help us serve patients better,” he added.
 

Sun Pharma's India formulation sales grew by 16.4 per cent Y-o-Y to Rs 4,144 crore, accounting for about 33.1 per cent of its total consolidated sales. This comes after the company had launched six new products in the Indian market during the 

quarter. The US formulation sales saw an on-year dip by 1 per cent at $466 million. The firm’s also reported a 14.7 per cent increase in global specialty sales to $266 million, contributing 17.7 per cent to the total sales. 

The emerging markets formulation sales rose by 8.8 per cent to $284 million, while formulation market sales for the Rest of the World (ROW) dipped by 2.9 per cent to $190 million.
 

Commenting on the reasons behind the dip in ROW formulations markets, Shanghvi said it was mainly due to price cuts and generic product pricing pressure in Japan. “We are expecting that business to continue to do well as time progresses,” he said.

The company’s research and development investments for Q1FY25 rose to Rs 794 crore, compared to Rs 680 crore for the same period last year.
 

It also reported that the company had completed its acquisition of all outstanding ordinary shares of Taro Pharmaceuticals Industries, other than the shares already held by the group, in Q1FY25 for a consideration of $347.7 million.
 

On the impact of Taro’s integration with Sun Pharma, Shanghvi said that there would be “no significant impact”. “We are already 80 per cent shareholders of Taro. We are working with a view to creating an integrated single organisation, both for customers as well as for suppliers. That’s what is our current plan,” he added.