KRChoksey's research report onSun Pharmaceutical
Net Sales stood at INR 67,110 Mn which was down by 1.7% y-o-y but was marginally up by 1.7% q-o-q, the improvement in revenues was due to increase in sales of US markets which grew 11% in the quarter.EBIDTA stood at INR 16,836 Mn which degrew 22.7% y-o-y but grew 15.8% q-o-q. Reduction in COGS and employee expenses led to improved profitability of the business. The company has reported margins of 19.4% in Q4FY18 against margins of 21.84% in Q3FY18 which has improved by 229 bps q-o-q.
OutlookAt CMP of INR 498 the stock is trading at PE of 20.3x at FY20E with EPS of INR 24.52. We recommend “ACCUMULATE” rating on the stock and value the stock at 22x FY20E EPS of INR 24.5 with a target price of INR 539 indicating 8% upside from CMP.
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