Add Sun Pharma Ltd For Target Rs. 820 - Yes Securities
Follow us Now on Telegram ! Get daily 10 - 12 important updates on Business, Finance and Investment. Join our Telegram Channel
https://t.me/InvestmentGuruIndiacom
Download Telegram App before Joining the Channel
Our view
Sun Pharma clocked a modest ex‐Taro US quarter in a palpable relief as ex‐Taro US sales not as much impacted by price erosion as seen with peers. India growth was in line with the strong growth seen in IPM in Q1. Key to watch would be the ramp up in US specialty sales and margin trajectory. We expect investments to inch up on existing and acquired products like Winlevi. R&D too in the range of 6‐8% as spending on Ilumya indications picks up momentum. We marginally tweak domestic sales and account for Taro’s provision resulting in 10% cut to FY22 EPS. Albeit, a stronger US momentum would be carried in to FY23 and we revise our TP slightly upwards to Rs820. Expect margins to normalize for rest of FY22 and improve to ~25% on sustainable basis in FY23. ADD stays on a business whose specialty sales can offer some buffer in times of steeper price erosion than seen in past 1‐2 years.
Result Highlights
* India business jumps 39% yoy; COVID sales accounted for 8‐10% of Q1 revenues
* Domestic business one off revenues would have carried very high margin coupled with lower SG&A resulting in margin beat
* Exudes optimism on US specialty sales as Ilumya to grow in double digit in FY22
To Read Complete Report & Disclaimer Click Here
Please refer disclaimer at https://yesinvest.in/privacy_policy_disclaimers
SEBI Registration number is INZ000185632
Above views are of the author and not of the website kindly read disclaimer
