SUN PHARMA 2018-19 Annual Report Analysis

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SUN PHARMA 2018-19 Annual Report Analysis
Tue, 6 Aug

SUN PHARMA has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

SUN PHARMA Income Statement Analysis

  • Operating income during the year rose 9.7% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 12.5% YoY during the fiscal. Operating profit margins witnessed a fall and down at 21.7% in FY19 as against 21.2% in FY18.
  • Depreciation charges increased by 16.9% and finance costs increased by 7.3% YoY, respectively.
  • Other income grew by 22.3% YoY.
  • Net profit for the year grew by 25.0% YoY.
  • Net profit margins during the year grew from 9.4% in FY18 to 10.7% in FY19.

SUN PHARMA Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 264,895 290,659 9.7%
Other income Rs m 8,388 10,255 22.3%
Total Revenues Rs m 273,282 300,914 10.1%
Gross profit Rs m 56,081 63,076 12.5%
Depreciation Rs m 14,998 17,533 16.9%
Interest Rs m 5,176 5,553 7.3%
Profit before tax Rs m 44,295 50,246 13.4%
Tax Rs m 9,110 6,009 -34.0%
Profit after tax Rs m 25,679 32,093 25.0%
Gross profit margin % 21.2 21.7
Effective tax rate % 20.6 12.0
Net profit margin % 9.4 10.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



SUN PHARMA Balance Sheet Analysis

  • The company's current liabilities during FY19 down at Rs 173 billion as compared to Rs 199 billion in FY18, thereby witnessing an decrease of -12.7%.
  • Long-term debt down at Rs 15 billion as compared to Rs 18 billion during FY18, a fall of 14.1%.
  • Current assets fell 2% and stood at Rs 311 billion, while fixed assets rose 9% and stood at Rs 232 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 647 billion as against Rs 645 billion during FY18, thereby witnessing a growth of 0%.

SUN PHARMA Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 383,141 414,091 8.1
 
Current Liabilities Rs m 198,643 173,396 -12.7
Long-term Debt Rs m 17,721 15,226 -14.1
Total Liabilities Rs m 645,164 646,938 0.3
 
Current assets Rs m 316,359 310,692 -1.8
Fixed Assets Rs m 213,178 232,477 9.1
Total Assets Rs m 645,164 646,938 0.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



SUN PHARMA Cash Flow Statement Analysis

  • SUN PHARMA's cash flow from operating activities (CFO) during FY19 stood at Rs 22 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs -7 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY19 stood at Rs -27 billion on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs -8 billion from the Rs -7 billion net cash flows seen during FY18.

SUN PHARMA Cash Flow Statement 2018-19

Particulars No. of months 12 12 % Change
Year Ending Mar-18 Mar-19
Cash Flow from Operating Activities Rs m 39,072 21,965 -43.8%
Cash Flow from Investing Activities Rs m -33,708 -6,813 -
Cash Flow from Financing Activities Rs m -15,393 -27,305 -
Net Cash Flow Rs m -7,359 -8,442 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for SUN PHARMA

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 13.4, an improvement from the EPS of Rs 10.7 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 418.4, stands at 31.6 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 4.4 times.
  • The company's price to cash flow (P/CF) ratio stood at 20.3 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Sales per share (Unadj.) Rs 110.4 121.1
TTM Earnings per share Rs 10.7 13.4
Diluted earnings per share Rs 10.7 13.3
Price to Cash Flow x 24.7 20.3
TTM P/E ratio x 31.5 31.6
Price / Book Value ratio x 3.5 3.1
Market Cap Rs m 1,003,850 1,006,985
Dividends per share (Unadj.) Rs 2.0 2.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for SUN PHARMA

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.8x during FY19, from 1.6x during FY18. 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 improved and stood at 10.0x during FY19, from 9.6x during FY18. 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 improved and stood at 7.8% during FY19, from 6.7% during FY19. 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 improved and stood at 10.2% during FY19, from 10.0% during FY18. 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 improved and stood at 5.8% during FY19, from 4.8% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Current ratio x 1.6 1.8
Debtors’ Days Days 108 112
Interest coverage x 9.6 10.0
Debt to equity ratio x 0.0 0.0
Return on assets % 4.8 5.8
Return on equity % 6.7 7.8
Return on capital employed % 10.0 10.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, 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 575.6 to Rs 418.4, registering a loss of Rs 157.2 or around 27.3%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 12,541.7 (up 0.8%). Over the last one year it has moved down from 14,613.6 to 12,541.7, a loss of 2,072 points (down 14.2%).

Overall, the S&P BSE SENSEX is down 2.3% over the year.

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

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