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SUN PHARMA 2019-20 Annual Report Analysis
Tue, 31 Mar

SUN PHARMA has announced its results for the year ended March 2020. Let us have a look at the detailed performance review of the company during FY19-20.

SUN PHARMA Income Statement Analysis

  • Operating income during the year rose 13.0% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 32.7% YoY during the fiscal. Operating profit margins witnessed a fall and down at 20.4% in FY20 as against 17.4% in FY19.
  • Depreciation charges increased by 17.1% and finance costs decreased by 45.5% YoY, respectively.
  • Other income declined by 38.5% YoY.
  • Net profit for the year grew by 30.5% YoY.
  • Net profit margins during the year grew from 11.0% in FY19 to 12.8% in FY20.

SUN PHARMA Income Statement 2019-20

No. of Mths Year Ending 12 Mar-19* 12 Mar-20* % Change
Net Sales Rs m 290,659 328,375 13.0%
Other income Rs m 10,594 6,516 -38.5%
Total Revenues Rs m 301,254 334,891 11.2%
Gross profit Rs m 50,593 67,135 32.7%
Depreciation Rs m 17,533 20,528 17.1%
Interest Rs m 5,553 3,027 -45.5%
Profit before tax Rs m 38,102 50,096 31.5%
Tax Rs m 6,009 8,228 36.9%
Profit after tax Rs m 32,093 41,868 30.5%
Gross profit margin % 17.4 20.4
Effective tax rate % 15.8 16.4
Net profit margin % 11.0 12.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Read Now: We're Bullish on 2 Non-Nifty Stocks

SUN PHARMA Balance Sheet Analysis

  • The company's current liabilities during FY20 down at Rs 157 billion as compared to Rs 173 billion in FY19, thereby witnessing an decrease of -9.4%.
  • Long-term debt stood at Rs 20 billion as compared to Rs 15 billion during FY19, a growth of 33.3%.
  • Current assets rose 2% and stood at Rs 317 billion, while fixed assets rose 8% and stood at Rs 334 billion in FY20.
  • Overall, the total assets and liabilities for FY20 stood at Rs 651 billion as against Rs 621 billion during FY19, thereby witnessing a growth of 5%.

SUN PHARMA Balance Sheet as on March 2020

No. of Mths Year Ending 12 Mar-19* 12 Mar-20* % Change
Networth Rs m 414,091 452,645 9.3
 
Current Liabilities Rs m 173,396 157,064 -9.4
Long-term Debt Rs m 15,226 20,289 33.3
Total Liabilities Rs m 621,389 650,772 4.7
 
Current assets Rs m 310,692 316,542 1.9
Fixed Assets Rs m 310,698 334,230 7.6
Total Assets Rs m 621,389 650,772 4.7
* 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 FY20 stood at Rs 66 billion, an improvement of 198.4% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY20 stood at Rs -26 billion, an improvement of 280.0% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY20 stood at Rs -57 billion on a YoY basis.
  • Overall, net cash flows for the company during FY20 stood at Rs -14 billion from the Rs -8 billion net cash flows seen during FY19.

SUN PHARMA Cash Flow Statement 2019-20

Particulars No. of months 12 12 % Change
Year Ending Mar-19 Mar-20
Cash Flow from Operating Activities Rs m 21,965 65,548 198.4%
Cash Flow from Investing Activities Rs m -6,813 -25,888 -
Cash Flow from Financing Activities Rs m -27,305 -57,151 -
Net Cash Flow Rs m -8,442 -13,857 -
* 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 17.4, an improvement from the EPS of Rs 13.4 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 352.2, stands at 20.2 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 1.9 times, while the price to sales ratio stands at 2.6 times.
  • The company's price to cash flow (P/CF) ratio stood at 15.4 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-19* 12 Mar-20*
Sales per share (Unadj.) Rs 121.1 136.9
TTM Earnings per share Rs 13.4 17.4
Diluted earnings per share Rs 13.4 17.4
Price to Cash Flow x 23.2 15.4
TTM P/E ratio x 36.1 20.2
Price / Book Value ratio x 3.1 2.1
Market Cap Rs m 1,264,689 958,894
Dividends per share (Unadj.) Rs 2.8 4.0
* 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 improved and stood at 2.0x during FY20, from 1.8x during FY19. 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 17.5x during FY20, from 7.9x during FY19. 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 9.2% during FY20, from 7.8% during FY20. 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 11.2% during FY20, from 10.2% during FY19. 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 6.9% during FY20, from 6.1% during FY19. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-19* 12 Mar-20*
Current ratio x 1.8 2.0
Debtors’ Days Days 112 105
Interest coverage x 7.9 17.5
Debt to equity ratio x 0.0 0.0
Return on assets % 6.1 6.9
Return on equity % 7.8 9.2
Return on capital employed % 10.2 11.2
* 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 479.3 to Rs 352.2, registering a loss of Rs 127.1 or around 26.5%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 12,148.6 (up 3.4%). Over the last one year it has moved down from 14,407.9 to 12,148.6, a loss of 2,259 points (down 15.7%).

Overall, the S&P BSE SENSEX is down 24.2% 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 FY20? How does it compare to earlier years?

The revenues of SUN PHARMA stood at Rs 334,891 m in FY20, which was up 11.2% compared to Rs 301,254 m reported in FY19.

SUN PHARMA's revenue has grown from Rs 283,884 m in FY16 to Rs 334,891 m in FY20.

Over the past 5 years, the revenue of SUN PHARMA has grown at a CAGR of 4.2%.

What was the net profit of SUN PHARMA in FY20? How does it compare to earlier years?

The net profit of SUN PHARMA stood at Rs 41,868 m in FY20, which was up 30.5% compared to Rs 32,093 m reported in FY19.

This compares to a net profit of Rs 25,679 m in FY18 and a net profit of Rs 78,363 m in FY17.

Over the past 5 years, SUN PHARMA net profit has grown at a CAGR of -7.2%.

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 increased in FY20 and stood at Rs 65,548 m as compared to Rs 21,965 m in FY19.
  • Cash flow from investments decreased in FY20 and stood at Rs -25,888 m as compared to Rs -6,813 m in FY19.
  • Cash flow from financial activity decreased in FY20 and stood at Rs -57,151 m as compared to Rs -27,305 m in FY19.

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

(Rs m)FY16FY17FY18FY19FY20
From Operations66,85970,82239,07221,96565,548
From Investments-43,716-42,216-33,708-6,813-25,888
From Financial Activity-18,885-22,854-15,393-27,305-57,151
Net Cashflow8,4826,107-7,359-8,442-13,857

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 down at 20.4% in FY20 as against 17.4% in FY19.
  • Net profit margins grew from 11.0% in FY19 to 12.8% in FY20.
  • Debt to Equity ratio for FY20 stood at 0.0 as compared to 0.0 in FY19.

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

 FY16FY17FY18FY19FY20
Operating Profit Margin (%)26.931.217.417.420.4
Net Profit Margin (%)20.425.29.711.012.8
Debt to Equity Ratio (x)0.10.00.00.00.0

Read: Latest Annual Report Analysis of SUN PHARMA

 

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