Sun Pharma — Positive On Specialty Portfolio Ramp-Up In The U.S., Continued Growth In India: Nirmal Bang

Nirmal Bang Report

We hosted the management of Sun Pharmaceutical Industries Ltd., to gain insights into the current business outlook. Scaling up of the global Specialty portfolio would remain the key focus area with Ilumya, Winlevi and Cequa being the main growth drivers.

In India, the target would be to grow in line faster than the market on the back of new addition of medical representatives and new launches. The recent MR addition was mainly to enhance focus on specialist doctors in tier II and beyond cities.

Sun Pharma's management sees scope for outperformance in domestic market with the help of geographical expansion. The management has reiterated its single-digit revenue growth guidance for FY24. We remain positive on Sun Pharma on the back of the following catalysts:

1. Ramp-up of branded/specialty business in the U.S. (recently acquired Deuruxolitinib would further strengthen the specialty pipeline),

2. continued growth in India business,

3. potential inorganic opportunity due to a strong balance sheet, especially in dermatology, ophthalmology and oncology specialty segments and

4. maintenance of healthy Ebitda margin at ~27% despite higher research and development spends.

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