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Sunpharma Ltd — Q2 FY24
Sun Pharma reported Q2 FY24 consolidated revenue of INR 12,003 crore, up 11% YoY, driven by India formulations (11.1% growth) and global specialty sales (19.3% growth to $240M).
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Sun Pharma reported Q2 FY24 consolidated revenue of INR 12,003 crore, up 11% YoY, driven by India formulations (11.1% growth) and global specialty sales (19.3% growth to $240M). EBITDA margin contracted 90bps YoY to 26.1% due to higher R&D and selling expenses. PAT grew 5% YoY to INR 2,376 crore. US sales grew 4.2% to $430M, supported by specialty products Ilumya, Cequa, and Winlevi, but offset by Halol/Mohali plant issues and lower Revlimid contribution. Management highlighted strong prescription trends and market share gains in specialty, but provided no specific FY24 guidance. Risks include Halol remediation timeline uncertainty, Taro's Israel operations exposure, and potential pricing pressure in US generics.
सन फार्मा ने दूसरी तिमाही में 12,003 करोड़ रुपये की कमाई की, जो पिछले साल से 11% ज्यादा है। भारत में दवाओं की बिक्री 11.1% और दुनिया भर में खास दवाओं की बिक्री 19.3% बढ़ी। मुनाफा 5% बढ़कर 2,376 करोड़ रुपये हुआ। अमेरिका में बिक्री 4.2% बढ़ी, लेकिन कुछ फैक्ट्रियों की समस्या और एक दवा की कम बिक्री से असर पड़ा। कंपनी ने खास दवाओं में अच्छी बिक्री देखी, लेकिन पूरे साल का कोई अनुमान नहीं दिया। जोखिमों में फैक्ट्री की मरम्मत में देरी, तारो कंपनी पर इज़राइल युद्ध का असर और अमेरिका में सस्ती दवाओं की कीमत कम होना शामिल है।
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Halol plant remediation uncertainty
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Global Specialty Sales
$240M
+19.3% YoY
Global specialty sales grew 19.3% YoY to $240M, driven by Ilumya, Cequa, and Winlevi.
India Market Share
8.4%
-10bps YoY
Sun Pharma holds 8.4% market share in the Indian pharma market (MAT Sep 2023), down from 8.5%.
US Formulation Sales
$430M
+4.2% YoY
US sales grew 4.2% YoY to $430M, driven by specialty but offset by plant issues and lower Revlimid.
R&D Spend
INR 7,734M
6.4% of sales
R&D spend was INR 7,734M (6.4% of sales), with specialty R&D accounting for 38.2%.
What Changed vs Last Quarter
NEW
Tax rate to inch up on annual basis
Tax rate expected to be higher than last year's 8.8% due to profit mix across jurisdictions.
UPDATED
R&D spend guidance maintained
Management expects R&D expenses to remain at similar levels or increase due to clinical trial ramp-up.
UPDATED
India business to grow higher than market
Management aims to grow India formulation business faster than the Indian pharmaceutical market on an annualized basis.
DROPPED
Lenalidomide sales expected to remain episodic
CFO noted that lenalidomide sales were significant in Q1 but will be episodic going forward, not a steady revenue stream.
DROPPED
Deuruxolitinib 8mg filing on track; no slowdown in OLE studies
Management confirmed that the partial clinical hold on 12mg has been lifted, and 8mg dosing continues as planned with no delays.
NEW RISK
Halol plant remediation uncertainty
Halol plant remains under FDA scrutiny; no timeline for re-inspection or resolution, impacting US generic supply.
NEW RISK
Taro Israel operations exposure
Taro's operations in Israel may be impacted by regional conflict, though management says business continuity is maintained.
NEW RISK
US generic pricing pressure
Management sees no significant improvement in generic pricing environment; pricing remains product-specific and competitive.
RISK GONE
Mohali plant supply suspension continues
Supplies from Mohali have not resumed; residual inventory sales are declining. Market share loss may be permanent depending on competition and contracts.
RISK GONE
India market share decline and NLEM impact
India market share fell to 8.33% from 8.5% due to NLEM price cuts and sitagliptin patent expiry. Recovery timeline uncertain.
RISK GONE
Taro acquisition uncertainty
Management provided no update on the Taro minority buyout beyond forming a special committee. Strategic benefits remain unclear.
RISK GONE
Specialty R&D pipeline execution risk
Multiple Phase II/III trials (ILUMYA PsA, deuruxo, GLP-1) require significant investment. Failure or delay could impact returns.
Fast read
Guidance and risk preview
Management expects R&D expenses to remain at similar levels or increase due to clinical trial ramp-up.
Halol plant remains under FDA scrutiny; no timeline for re-inspection or resolution, impacting US generic supply.
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