also said it would have to go through the regulatory process for its products in China, and does not expect significant revenues in the short term.
This comes at a time when its US business has remained flat during Q2 year-on-year basis (YoY). Sun expects the market to remain competitive for generics in the US, which constitutes almost 30 per cent of its consolidated sales. It continues to focus on its specialty portfolio for the US and this, in turn, has pushed up marketing and branding costs (reflected in rise in other expenses). The company, however, posted numbers in line with estimates.
Net profit stood at Rs 1,064 crore, with the resulting net profit margin at 13.4 per cent, against a net loss of Rs 269.6 crore in Q2FY19. Adjusted for the exceptional item of Rs 1,214 crore for Q2 last year (related to the Modafinil settlement), net profit growth was at 12.6 per cent, the company said.
Income from operations came in at Rs 7,949 crore, up 16 per cent YoY. The India business clocked a robust 35 per cent YoY growth to Rs 2,515 crore, while US-finished dosage sales remained flat at $339 million.
Emerging market sales were also flat — growing only 3 per cent YoY to $201 million. Rest of the world markets saw decent uptick over last year’s September quarter, clocking a 49 per cent rise.
said its earnings before interest, taxes, depreciation and amortisation (Ebitda) came in at Rs 1,616 crore, up 12 per cent, with the resulting Ebitda margin at 20.3 per cent. ICICI Direct said Ebitda margins were flat at around 22 per cent, YoY. However, they were better than I-Direct’s estimates of 20.5 per cent, mainly on account of a better product mix and lower R&D spends.
The analysts added that key near-term triggers were the performance of its speciality pipeline — such as Ilumya, Odomzo, etc — and ramp-up of its Halol formulation plant.
The stock closed up 3 per cent on the BSE at Rs 440.45 apiece.
“However, we expect investors to remain cautious, in the backdrop of the whistle-blower’s complaint filing to Sebi. These issues may outweigh the company’s sound fundamentals in the near term,” the brokerage added.