Sun Pharma’s Q2 net profit jumps 28% on-year to Rs 3,040 crore, beats expectations

Sun Pharmaceutical Industries Ltd Q2 FY25 Results

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Sun Pharmaceutical Industries reported a strong Q2 FY25 performance with net profit surging 28 percent on-year to Rs 3,040 crore, surpassing analyst expectations. A Moneycontrol poll of 10 brokerages had estimated the drugmaker’s July-September net profit at Rs 2,911 crore, attributing the outperformance to strong seasonality and robust specialty segment growth.

India’s largest drugmaker’s consolidated revenue from operations too expanded 9 percent on-year to Rs 13,291 crore during July-September, fueled by double-digit growth across key markets, particularly the US. This was in line with the poll estimate of Rs 13,299 crore.

EBITDA for Q2 grew 23.9 percent to Rs 3,939 crore, yielding a margin of 29.6 percent, up from 26.1 percent in the prior year. The margin expansion was due to a higher contribution from specialty products, particularly in the US; though, Sun Pharma said it continues to invest heavily in research and development (R&D) to support its specialty pipeline.

Sun Pharma stock added to the day's gains after the results announcement, and was trading at Rs 1,913 on NSE, up 2.8 percent from the previous close.

Sun Pharma Q2 FY25 segmental performance

- India Formulations: Domestic sales grew 11 percent to Rs 4,265 crore, accounting for 32 percent of total revenue. The company launched 14 new products this quarter, consolidating its position as the market leader with a share increase to 8.1 percent.

- US Formulations: Revenue from the US rose 20.3 percent to $517 million, boosted by specialty sales, which surged 19.2 percent to $286 million.

- Emerging and RoW Markets: Emerging market sales increased by 3.2 percent to $293 million, while the Rest of World (RoW) markets saw a decline of 3.5 percent, generating $199 million.

- API Sales: Active pharmaceutical ingredient (API) sales for the quarter were Rs 533.8 crore, marking a 7.4 percent increase year-on-year.
R&D Investments and Pipeline Expansion

R&D expenses totaled Rs 792.9 crore, representing 6 percent of sales for the quarter, as Sun Pharma advances its global specialty pipeline. This includes the recent US FDA approval for Leqselvi, a treatment for severe alopecia areata, the company said in the notes to the results.

Further, Sun Pharma's agreement with Philogen to commercialise Fibromun also expands its dermatology portfolio. Chairman and Managing Director Dilip Shanghvi said: “Sun has recently strengthened its specialty pipeline through an agreement with Philogen for commercializing late stage candidate Fibromun, upon approval. With Fibromun, our product basket for dermatologists has expanded further. We shall continue to leverage our strong cash position to strengthen our pipeline with products that are close to market.”