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SUN PHARMA 2017-18 Annual Report Analysis
Sat, 31 Mar

SUN PHARMA has announced its results for the year ended March 2018. Let us have a look at the detailed performance review of the company during FY17-18.

SUN PHARMA Income Statement Analysis

  • Operating income during the year fell 15.1% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 52.7% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 17.4% in FY18 as against 31.2% in FY17.
  • Depreciation charges increased by 18.6% and finance costs increased by 29.5% YoY, respectively.
  • Other income declined by 11.5% YoY.
  • Net profit for the year declined by 67.2% YoY.
  • Net profit margins during the year declined from 25.2% in FY17 to 9.7% in FY18.

SUN PHARMA Income Statement 2017-18

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Net Sales Rs m 310,378 263,416 -15.1%
Other income Rs m 10,302 9,121 -11.5%
Total Revenues Rs m 320,680 272,537 -15.0%
Gross profit Rs m 96,822 45,843 -52.7%
Depreciation Rs m 12,648 14,998 18.6%
Interest Rs m 3,998 5,176 29.5%
Profit before tax Rs m 90,479 34,790 -61.5%
Tax Rs m 12,116 9,110 -24.8%
Profit after tax Rs m 78,363 25,679 -67.2%
Gross profit margin % 31.2 17.4
Effective tax rate % 13.4 26.2
Net profit margin % 25.2 9.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



New Research: 2 stocks to buy as Nifty50 heads towards 40,000

SUN PHARMA Balance Sheet Analysis

  • The company's current liabilities during FY18 stood at Rs 199 billion as compared to Rs 179 billion in FY17, thereby witnessing an increase of 11.1%.
  • Long-term debt stood at Rs 18 billion as compared to Rs 14 billion during FY17, a growth of 23.4%.
  • Current assets fell 4% and stood at Rs 316 billion, while fixed assets rose 17% and stood at Rs 305 billion in FY18.
  • Overall, the total assets and liabilities for FY18 stood at Rs 621 billion as against Rs 589 billion during FY17, thereby witnessing a growth of 5%.

SUN PHARMA Balance Sheet as on March 2018

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Networth Rs m 366,370 383,141 4.6
 
Current Liabilities Rs m 178,870 198,643 11.1
Long-term Debt Rs m 14,361 17,721 23.4
Total Liabilities Rs m 589,174 621,090 5.4
 
Current assets Rs m 329,537 316,359 -4.0
Fixed Assets Rs m 259,638 304,731 17.4
Total Assets Rs m 589,174 621,090 5.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



SUN PHARMA Cash Flow Statement Analysis

  • SUN PHARMA's cash flow from operating activities (CFO) during FY18 stood at Rs 39 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY18 stood at Rs -34 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY18 stood at Rs -15 billion, an improvement of 33% on a YoY basis.
  • Overall, net cash flows for the company during FY18 stood at Rs -7 billion from the Rs 6 billion net cash flows seen during FY17.

SUN PHARMA Cash Flow Statement 2017-18

Particulars No. of months 12 12 % Change
Year Ending Mar-17 Mar-18
Cash Flow from Operating Activities Rs m 70,822 39,072 -44.8%
Cash Flow from Investing Activities Rs m -42,216 -33,708 -
Cash Flow from Financing Activities Rs m -22,854 -15,393 -
Net Cash Flow Rs m 6,107 -7,359 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for SUN PHARMA

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 10.7, an decline from the EPS of Rs 32.7 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 495.4, stands at 45.1 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 3.1 times, while the price to sales ratio stands at 4.5 times.
  • The company's price to cash flow (P/CF) ratio stood at 33.4 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-17* 12 Mar-18*
Sales per share (Unadj.) Rs 129.4 109.8
TTM Earnings per share Rs 32.7 10.7
Diluted earnings per share Rs 32.7 10.7
Price to Cash Flow x 18.1 33.4
TTM P/E ratio x 22.3 45.1
Price / Book Value ratio x 4.6 3.5
Market Cap Rs m 1,696,877 1,360,056
Dividends per share (Unadj.) Rs 3.5 2.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for SUN PHARMA

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 1.6x during FY18, from 1.8x during FY17. The current ratio measures the company's ability to pay short-term and long-term obligations.

    Interest Coverage Ratio: The company's interest coverage ratio deteriorated and stood at 7.7x during FY18, from 23.6x during FY17. The interest coverage ratio of a company states how easily a company can pay its interest expense on outstanding debt. A higher ratio is preferable.

  • Profitability Ratios
  • Return on Equity (ROE): The ROE for the company declined and down at 6.7% during FY18, from 21.4% during FY18. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

    Return on Capital Employed (ROCE): The ROCE for the company declined and down at 10.0% during FY18, from 24.8% during FY17. The ROCE measures the ability of a firm to generate profits from its total capital (shareholder capital plus debt capital) employed in the company.

    Return on Assets (ROA): The ROA of the company declined and down at 5.0% during FY18, from 14.0% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-17* 12 Mar-18*
Current ratio x 1.8 1.6
Debtors’ Days Days 85 108
Interest coverage x 23.6 7.7
Debt to equity ratio x 0.0 0.0
Return on assets % 14.0 5.0
Return on equity % 21.4 6.7
Return on capital employed % 24.8 10.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



To see how SUN PHARMA has performed over the last 5 years, please visit here.

SUN PHARMA Share Price Performance

Over the last one year, SUN PHARMA share price has moved down from Rs 687.7 to Rs 495.4, registering a loss of Rs 192.3 or around 28.0%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 13,157.6 (down 1.1%). Over the last one year it has moved down from 15,312.4 to 13,157.6, a loss of 2,155 points (down 14.1%).

Overall, the S&P BSE SENSEX is up 12.1% over the year.

(To know more, check out historical annual results for SUN PHARMA and quarterly results for SUN PHARMA)

Annual Report FAQs

What is the current share price of SUN PHARMA?

SUN PHARMA currently trades at Rs 1,620.5 per share. You can check out the latest share price performance of SUN PHARMA here...

What was the revenue of SUN PHARMA in FY18? How does it compare to earlier years?

The revenues of SUN PHARMA stood at Rs 272,537 m in FY18, which was down -15.0% compared to Rs 320,680 m reported in FY17.

SUN PHARMA's revenue has grown from Rs 164,778 m in FY14 to Rs 272,537 m in FY18.

Over the past 5 years, the revenue of SUN PHARMA has grown at a CAGR of 13.4%.

What was the net profit of SUN PHARMA in FY18? How does it compare to earlier years?

The net profit of SUN PHARMA stood at Rs 25,679 m in FY18, which was down -67.2% compared to Rs 78,363 m reported in FY17.

This compares to a net profit of Rs 56,569 m in FY16 and a net profit of Rs 54,882 m in FY15.

Over the past 5 years, SUN PHARMA net profit has grown at a CAGR of -9.8%.

What does the cash flow statement of SUN PHARMA reveal?

The cash flow statement is the financial statement that presents the cash inflows and outflows of a company during a given period of time.

This statement is one of the most useful tools for judging a company's liquidity position. The ratios and parameters in this statement helps test a company's financial health.

The cash flow statement of SUN PHARMA reveals:

  • Cash flow from operations decreased in FY18 and stood at Rs 39,072 m as compared to Rs 70,822 m in FY17.
  • Cash flow from investments increased in FY18 and stood at Rs -33,708 m as compared to Rs -42,216 m in FY17.
  • Cash flow from financial activity increased in FY18 and stood at Rs -15,393 m as compared to Rs -22,854 m in FY17.

Here's the cash flow statement of SUN PHARMA for the past 5 years.

(Rs m)FY14FY15FY16FY17FY18
From Operations39,59256,15766,85970,82239,072
From Investments-23,668-28,657-43,716-42,216-33,708
From Financial Activity5,066-11,865-18,885-22,854-15,393
Net Cashflow22,89629,2698,4826,107-7,359

What does the Key Ratio analysis of SUN PHARMA reveal?

Be it the company's profitability, operations effectiveness or utilization of funds, ratio analysis is an important tool which helps in making investment decisions.

The ratio/financial analysis of SUN PHARMA reveals:

  • Operating profit margins witnessed a fall and stood at 17.4% in FY18 as against 31.2% in FY17.
  • Net profit margins declined from 25.2% in FY17 to 9.7% in FY18.
  • Debt to Equity ratio for FY18 stood at 0.0 as compared to 0.0 in FY17.

Here's the ratio/financial analysis of SUN PHARMA for the past 5 years.

 FY14FY15FY16FY17FY18
Operating Profit Margin (%)28.027.826.931.217.4
Net Profit Margin (%)24.420.220.425.29.7
Debt to Equity Ratio (x)0.00.10.10.00.0

Read: Latest Annual Report Analysis of SUN PHARMA

 

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