India's largest drugmaker Sun Pharma is confident that its specialty sales business will continue its growth momentum in the future. "Global specialty sales at $ 871 million, up 29 percent over same period last year, Is contributing 16.2 percent of consolidated revenue in the current fiscal as against 7.3 percent in FY18, which is more than doubled in the past 4 to 5 years," chief financial officer (CFO) CS Muralidharan told CNBC-TV18 in an interview.

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On FY24 guidance, Muralidharan said, "We are not giving any guidance for speciality, but I just want to say that last year we did if I remember $674 million from there, we got $871 million, almost 200 million up and the rest is maths can be done."

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The top official also said that the company's board has proposed a non-binding indication of interest to increase its stake in Taro Pharma to 100 percent, in a deal valued at nearly $300 million.

At present, Sun Pharma holds 78.48 percent stake in Taro. The company had initiated similar plans a decade earlier as well. The all-cash deal proposes to value Taro at $38 per share, which is a 41.5 percent premium over the stock's average closing price over the last 60 days.

Sun Pharma also plans on delisting Taro from the NYSE on completion of the transaction. It is also a premium of 31.2 percent to Taro's closing price on May 25.

Sun Pharma has proposed a reverse triangular merger for this move. For this, the company will form a wholly-owned subsidiary in the form of a Special Purpose Vehicle (SPV), which will enter into a merger agreement with Taro.

The SPV will then merge with and into Taro. The latter's board has appointed an independent committee to evaluate this proposal. Sun Pharma is not willing to consider a sale of Taro's shares to a third party, even as the company evaluates the proposal.

This transaction will not be subject to any financial contingency.

Sun Pharma Q4 earnings

The drugmaker posted a consolidated net profit of Rs 1,984.47 crore for the quarter ended March 31, 2023, against a loss of Rs 2,277.25 crore in the same period last year. The profit was, however, lower sequentially as it stood at Rs 2,166.01 crore in Q3FY23.

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The revenue for the reporting quarter came in at Rs 10,726 crore, up 12 percent year-on-year (YoY) as against Rs 9,560 crore in Q4FY22.

Earnings Before Interest, Taxes, Depreciation and Amortisation or EBITDA for the March quarter was at Rs 2,802.10 crore, up 19.7 percent versus Q4FY22. EBITDA margin for Q4 stood at 25.6 percent as compared to 24.8 percent in the same period year ago.

The company also approved a final dividend of Rs 4 per equity share which will be subject to the approval of the shareholders. The total dividend payout for FY23 is Rs 11.5 per share compared to Rs 10 per share for FY22.