ABOUT THE SUN PHARMA

Sun Pharma has expanded to rank among the biggest generic pharmaceutical firms in the world since it
was founded in 1983. Sun Pharma is India's biggest pharmaceutical corporation.
 
Sun Pharma is also one of the top ten generic drug manufacturers in the US and comes in second place
by prescriptions in the generic dermatological industry.
 
With a presence in more than 80 locations, Sun Pharma is the biggest Indian corporation in emerging
markets. Some of Sun pharma's important emerging markets are South Africa, Brazil, Mexico, Russia,
and Romania. Sun Pharma employs more than 37,000 people globally

KEY HIGHLIGHTS
FY 2013-14
The corporation awarded bonus shares of one equity share worth Rs. 1 for each share held during the
fiscal year 2013–2014.
Currently, the Company has a strong group of medical representatives (MR) advertising its goods and
cultivating partnerships with physicians. Over 4,000 MRS, including supervisors, work with 140,000
specialised doctors nationwide.
Due to considerable expansion in the US business and a favourable currency, which benefited the
export sales, India's contribution to revenue decreased from 26% in FY14.
FY2014-15
Revenue from Indian branded generics increased by 82% to ` 67,165.9 million in FY15. It was
primarily due to the acquisition of Ranbaxy's India operations and an increase in sales of the existing
chronic illness pharmaceuticals products.
Revenue contribution from Indian branded generics increased slightly from 23% in FY14 to 24% in
FY15. Over 16 products were launched in the Indian market in FY15.
In April 2014, Sun Pharma announced the acquisition of Ranbaxy in one of India's largest M&A
transactions. Ranbaxy's acquisition has further enhanced Sun Pharma's position in the Indian market. It
became the largest player in India with an 8.9% market share and No. 1 ranking by prescriptions with
13 different doctor categories.
FY 2015-16
In FY15, sales of Indian branded generics rose by 82% to '67,165.9 million. The purchase of Ranbaxy's
Indian business and a rise in sales of the Company's already-available medications for chronic illnesses
were the main causes.
From 23% in FY14 to 24% in FY15, revenue contribution from Indian branded generics grew
somewhat. In FY15, more than 16 goods were introduced to the Indian market.
FY 2016-17
As of the end of FY16, Sun Pharma had acquired 14 well-known prescription brands from Novartis AG
and Novartis Pharma AG for a sum of US$ 293 million, which was a significant step towards
strengthening its presence in Japan.
In order to advance the development of MM-II, a new pharmacological candidate for the management
of pain in osteoarthritis, Sun Pharma engaged in an exclusive worldwide licence agreement in
December 2016.
Several of the Company's facilities were audited during FY17 by numerous international regulatory
organisations, including the USFDA. These inspections were successful, although there are still some
unresolved deviations at some locations, which the Company is working to fix.
 
FY 2017-18
New Drug Application(NDA) for OTX-101 was accepted by USFDA in 2017
The brief disruption in the trade channel caused by the Goods & Services Tax (GST) implementation
throughout the year had an impact on domestic market growth overall. After adjusting for this effect,
our India revenues increased by almost 9%.
In terms of accruing the synergy advantages from the purchase of Ranbaxy, FY18 was crucial. $300
million was the targeted amount for synergy benefits for FY18.
Revenue from emerging markets grew by 7% to 48,392 Million in FY18
FY 2018-19
Revenue from emerging markets increased by 11% to 53,625 Million.
Revenue from the Indian branded generic business declined by 8.5% to 73,483 Million.
The Company has decided to transition its India formulations distribution business from a third-party
distributor to the Company's wholly-owned subsidiary.
Revenue from the Active Pharmaceutical Ingredients (API) business increased by 24% to 17,303
Million.
FY 2019-20
The Company continued its growth trajectory in FY20, with our overall revenues growing by about
13% to ₹323 Billion. Key growth drivers include India, global speciality business, coupled with growth
in the rest of the world and API business.
Revenue from the India formulations business increased by 32% to `97,102 Million.
Revenue from the API business increased by 11% to `19,159 Million.
For the treatment of COVID-19 and related conditions, the Company supplied medications such as
Remdesivir, Itolizumab, Hydroxychloroquine (HCQS), Favipiravir, and Liposomal Amphotericin B in
the Indian market.
Sun Pharma and Eli Lilly agreed to a licencing arrangement in May 2021 to increase access to
baricitinib, easing the burden of COVID-19 in India.
The COVID-19 pandemic caused an increase in vitamin consumption, which led to higher sales of
Revital-H, which in turn drove the consumer business revenue in India to climb by double digits.

FY 2021-22
Revenue from the India Formulations business grew by 23.4% to ₹127,593 Million, driven by growth
across most of the Company's therapies.
Field force operations, travel, branding and promotional activities that were disrupted in FY21 due to
pandemic limitations also returned to normal in FY22.
In FY22, Sun Pharma's key brands – Volini and Revital – maintained strong market preference, higher
consumer preference and brand recall.
As global markets return to normalcy, R&D investments are expected to increase in FY23

Financial Ratio Analysis

Overall Performance

\
The return on asset (RoA) percentage is at about 1% for the most recent financial year, i.e., 2021-22. It
shows that there is inefficient utilisation of resources throughout the company. It is also evident from
the return on assets ratio across the past 10 years that the company has mismanaged its utilisation of
assets consistently.

The return on shareholders’ funds (RoE) in the most recent financial year highlights the inefficiency of
the company at utilising equity to generate profits. The same is a consistent trend throughout the past
decade.
Sun Pharma did well only in two instances when it came to converting their sales into profit, i.e., in
the FY 2012-13 & FY 2019-20. In the most recent financial year it suffered a loss of 1% meaning the
company needs to pull up its socks.

The company is very efficient at utilising its assets to generate sales and thus revenue as is evident
from the consistently high asset turnover ratio. The most recent two financial years, owing to COVID,
had a higher conversion rate in comparison to the previous years.

The company is very inefficient at retrieving receivables from their customers. So much so that in FY
2017-18, they were taking upto 220 days to retrieve their receivables, meaning that their operating
income was cut short during such periods.
The company is fairly consistent in its return of payables to their respective accounts, averaging
around 60 days. During COVID, there was a spike in the time it took for them fulfil their payables,
but they were able to bring it down in the most recent financial year to their average.

Sun pharma may have had a high current ratio in FY 2012-13 indicating ample liquidity but that has
changed over the past decade. After facing a large slump from FY 2014-15 to FY 2018-19, they
seemed to have recovered a little bit in the COVID period. The ratio of 0.96 in the most recent
financial year  indicates that the company may have difficulty meeting its current obligations. 
However, this does not mean that they face a critical problem. In case they have good long-term
prospects, they can may be able to borrow against these prospects to fulfil their current obligations.

Similar to their current ratio, their acid test ratio was also higher up in the FY 2012-13 after which
they had a steep fall, indicating the inadequacy of their liquid assets to repay their current liabilities.
Currently, they have an acid test ratio of 0.62 meaning they cannot currently fully pay back its current
liabilities.

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