Sun Pharmaceutical Industries Limited — Q4 FY25 earnings call

Call held 29 May 2025

Management summary

Sun Pharmaceutical Industries reported a strong Q4 and full year FY25, driven by robust performance in India and Global Specialty segments. Full year sales grew 9% to Rs. 520,412 million, with EBITDA expanding 17.3% to Rs. 152,717 million, achieving a 29% margin. Q4 sales increased 8.5% to Rs. 128,156 million, and EBITDA grew 22.4% to Rs. 37,161 million. The company proposed a total dividend of Rs. 16 per share for FY25, reflecting confidence in its financial health and future growth prospects.

Highlights

  • Full year FY25 sales reached Rs. 520,412 million, a growth of 9% over last year.

  • Full year FY25 EBITDA was Rs. 152,717 million, growing 17.3% with a resulting EBITDA margin of 29%.

  • Full year FY25 Adjusted net profit was Rs. 119,844 million, up 19%.

  • Q4 FY25 sales were Rs. 128,156 million, an 8.5% growth over Q4 FY24.

  • Q4 FY25 EBITDA was Rs. 37,161 million, higher by 22.4% over Q4 FY24, with an EBITDA margin of 28.7%.

  • Q4 FY25 Adjusted net profit (excluding exceptional items) was Rs. 28,890 million, representing a growth of 4.8% over Q4 FY24.

  • India formulation sales for the full year FY25 were Rs. 169,230 million, recording 13.7% growth.

  • Global Specialty sales for FY25 were up 17.1% to reach $1,216 million.

What they filed

Q1 FY27: revenue up 2.6%, net profit up 49.7% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue5,122 6,181 7,179 5,595 4,548 −11%5,688 −8%4,924 −31%5,741 +3%
EBITDA1,332 1,705 3,059 1,910 1,184 −11%1,759 +3%1,329 −57%1,964 +3%
Net profit838 1,156 2,042 745 564 −33%705 −39%609 −70%1,115 +50%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Guidance & targets

Tax Rate

  • Effective Tax Rate Tax Rate · full year basis (FY26 onwards) · Medium confidence continue to go up
    Going forward, we expect the tax rate to continue to go up on a full year basis, mainly on account of exhaustion of tax losses.

    — C. S. Muralidharan, CFO

Revenue

  • Consolidated Topline Growth Revenue · FY26 · Medium confidence mid to high single digit
    And lastly, on the guidance of FY'26, we expect mid to high single digit consolidated topline growth for FY'26.

    — Dilip Shanghvi, Chairman & Managing Director

Investment

  • Additional Commercialization Spend for New Specialty Products Investment · FY26 · High confidence approximately US$ 100 million
    For the current year, we are looking to invest approximately US$ 100 million additionally on commercialization of new Specialty product.

    — Dilip Shanghvi, Chairman & Managing Director

R&D Spend

  • R&D Spend as % of Sales R&D Spend · FY26 · High confidence 6% to 8%
    We now expect our FY'26 R&D spend to be 6% to 8% of sales for the next year.

    — Dilip Shanghvi, Chairman & Managing Director

Product Launch

  • Leqselvi US Launch Product Launch · Q2 FY26 · High confidence quarter two
    So I think in the quarter two, we will be launching this product in the US.

    — Abhay Gandhi, CEO (North America Business)

Manufacturing

  • Time to approve new US manufacturing source (for biologics) Manufacturing · Future · High confidence at least 2.5-3 years
    I my view is that it will take at least 2.5-3 years before the new source is approved by the agency. And it cost a lot of money.

    — Dilip Shanghvi, Chairman & Managing Director

India Business

  • Growth vs. Market India Business · Ongoing · Medium confidence grow higher than the market
    No, I have been telling for the last couple of calls is we want to grow higher than the market.

    — Kirti Ganorkar, CEO (India Business)

2 min read

Detailed narrative

Sun Pharmaceutical Industries concluded FY25 with a strong financial performance, reporting full year sales of Rs. 520,412 million, a 9% increase over the previous year. This growth translated into a significant 17.3% rise in EBITDA to Rs. 152,717 million, with the EBITDA margin expanding to 29%. Adjusted net profit for the full year also saw a healthy 19% increase, reaching Rs. 119,844 million. For the fourth quarter of FY25, sales grew 8.5% to Rs. 128,156 million, and EBITDA increased 22.4% to Rs. 37,161 million, achieving a margin of 28.7%. Adjusted net profit for Q4, excluding exceptional items, was Rs. 28,890 million, up 4.8%.

The India formulation business was a key growth driver, achieving Rs. 169,230 million in sales for FY25, a 13.7% increase, and Rs. 42,130 million in Q4, up 13.6%. The company maintained its number one ranking in the Indian pharmaceutical market with an 8.3% market share. The Global Specialty business also performed robustly, with FY25 sales reaching $1,216 million, a 17.1% increase, and Q4 sales at $295 million, up 8.6%. Key specialty products like ILUMYA, CEQUA, WINLEVI, and ODOMZO contributed significantly to this growth. Emerging markets also showed solid performance, with full year revenues of $1,114 million (up 7%) and Q4 revenues of $261 million (up 6.3%, or 11.5% in constant currency).

Management provided a positive outlook for FY26, guiding for "mid to high single digit consolidated topline growth." The company plans to invest an additional "approximately US$ 100 million" in FY26 for the commercialization of new Specialty products, viewing this as a strategic investment to strengthen the business. R&D spend for FY26 is projected to be "6% to 8% of sales." A significant product launch, Leqselvi, is anticipated in Q2 FY26 in the US, despite ongoing patent litigation. The company also announced the acquisition of Checkpoint Therapeutics to leverage UNLOXCYT in targeted oncology.

During the Q&A, management addressed concerns regarding the US generic business decline due to competition and pricing pressure, attributing it to product-specific issues. They also discussed the potential impact of new MFN laws, noting a lack of clarity on implementation, and the long timeline (2.5-3 years) and high cost associated with establishing new US-based manufacturing for biologics like Ilumya. The effective tax rate is expected to "continue to go up" in FY26 due to the exhaustion of tax losses. Overall, the management expressed confidence in their strategic direction and pipeline, while acknowledging external uncertainties.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Healthcare earnings calls