Sun Pharma Q2 net surges 117% to Rs2,235 cr

Sun Pharmaceutical Industries, the country's leading pharmaceutical company, has reported a 117 per cent year-on-year increase in its net profit for the fiscal second quarter ended 30 September 2016-17 at Rs2,235 crore compared to Rs1,029 crore in the corresponding period of the previous fiscal.

Sun Pharma's profits were boosted by significant rise in other operating income and lower interest burden. Its other operating income moved up to Rs501 crore from Rs15 crore in the similar quarter of last year due to milestone payment of $45 million from Almirall SA (Spain) as part of the licensing agreement for the development and commercialization of Tildrakizumab for psoriasis in Europe.

On the other hand, its interest cost declined by 66 per cent to Rs54 crore from Rs158 crore. However, its tax burden increased by almost 50 per cent to Rs442 crore from Rs295 crore.

Consolidated net sales increased by 13.2 per cent to Rs7,764 crore from Rs6,858 crore in the corresponding quarter of last year.

Sale of branded formulations in India for Q2FY17 stood at Rs2,009 crore, up 11 per cent and accounting for 26 per cent of total sales. For the first half, sales were at Rs3,863 crore, higher by 9 per cent over same period last year.

Sun Pharma, the country's top pharmaceutical company, holds approximately 8.7 per cent market share in the Rs100,000 crore pharmaceutical market as per September-2016 AIOCD-AWACS report.

As per latest SMSRC report, Sun Pharma is ranked No 1 based on share of prescriptions with 12 classes of doctors. For Q2FY17, the company launched 8 new products in the Indian market.

Sales in the US stood a $555 million for the quarter, a growth of 9 per cent over same period last year and accounted for 48 per cent of total sales. For first half sales were $1,163 million - a growth of 17 per cent. Sales for the first half were boosted primarily due to the benefit of the 180-day exclusivity for Imatinib which commenced from 1 February 2016.

At the same time, Sun Pharma's subsidiary Taro posted Q2 FY17 sales of $229 million, up 8 per cent over Q2 last year. For the first half, sales were $463 million, up 8 per cent over first half last year. Taro's net profit for Q2 was $124 million, down 7 per cent over Q2 last year. Net profit for H1FY16 was at $234 million, down 1 per cent over first half last year.

Sun Pharma said its sales in emerging markets rose 22 per cent to $170 million for Q2, compared to the same quarter last year and accounted for 15 per cent of total sales. For the first half, sales were $325 million, up 19 per cent over first half last year. The growth is broad-based amongst emerging markets.

Formulation sales in rest of the world markets excluding US and emerging markets stood at $79 million in Q2FY17, a growth of 3 per cent from the corresponding quarter last year. For the first half, sales were $163 million, down 3 per cent over first half last year, impacted by supply constraints. These markets accounted for approximately 7 per cent of revenues for Q2FY17.

Its R&D expenditure increased to Rs.570 crore from Rs.498 crore and worked out to 7.3 per cent of its total sales. Currently, it has 423 approved ANDAs and 144 ANDAs are pending for approval, including 13 tentative approvals. For the September quarter, it filed 3 ANDAs and received approvals for 6 ANDAs. Additionally, the pipeline includes 37 approved NDAs which 4 NDAs await US FDA approval.

Dilip Shanghvi, managing director said, ''The synergies from the Ranbaxy acquisition are gaining momentum and we are on track to achieve the targeted benefits. These synergies will continue to help in funding our emerging specialty businesses. Post the close of the quarter, we further strengthened our branded ophthalmic pipeline through the acquisition of Ocular Technologies. We were also very happy to announce the detailed results for Tildrakizumab phase-3 trials which validate the potential of this product for psoriasis treatment.''

For the first half ended September 2016, Sun Pharma's net sales increased by 17.8 per cent to Rs15,771 crore from Rs13,385 crore in the similar period of last year.

Its net profit moved up sharply by 169 per cent to Rs4,269 crore from Rs1,585 crore, mainly due to higher other operating income and exceptional loss in the last period. EPS improved to Rs17.7 from Rs6.6 in the last period. Interest cost declined by 35.6 per cent to Rs188 crore from Rs293 crore.

Further, in the previous year period it had shown an exceptional loss of Rs685 crore. However, tax provision increased to Rs794 crore from Rs407 crore in the prevuious-year quarter.