Sun Pharmaceuticals will be in focus today ahead of its Q3 earnings scheduled to be released later in the day.

Click here to read the Q3 results

For Sun Pharmaceuticals, there will be a lot of emphasis in terms of what happens with the margins this quarter, the US business as well as the management commentary. Here are the key things to watch out for:

Revenue in Q3FY19 estimated to grow 13 percent led by pick up US and Rest of World markets

EBITDA growth of around 19 percent with margins at 23 percent versus 22 percent. Expect margin improvement to 23 percent vs 21.8 percent YoY & vs 22 percent QoQ

Profit growth of around Rs 1,064 crore which will be also supported by a low base.

US business estimated to grow around 7-8 percent YoY aided by low base of last year and launch of drug Ilumya. Watch for lower sales of gWelchol in US. US estimated to be around $350-352 m in sales

India expected to grow around 8-10 percent YoY. Rest of World estimated to grow 15-17 percent

API business estimated to grow 20-23%

The last quarter was a revenue miss but it was operationally and in-line set of numbers. So whether or not the management continues to be able to deliver in terms of the operational numbers for the company, that will be watched out for closely.

Last quarter, the US missed estimates, so around $342 million is what they generated versus estimates of around $390 million

One of the key things to watch out for will be the fact that Taros come out with already a very healthy set of numbers, so that will give a preview in terms of whether or not the US business should do well.

Whistleblower Concerns

Domestic formulations distribution from Aditya Medisales to be transitioned. Domestic formulations distribution will be transitioned to a wholly-owned arm

Loans and advances given to Atlas Global Trading will be settled

Protonix patent litigation settled by Sun Pharma in 2013

No loans or guarantees given to Suraksha Realty

Initiated steps to induct SRBC & Co LLP as statutory auditors of subsidiaries

Watch for higher expenditure on a/c of new products launch

R&D spend estimates at 8-9% of sales on a/c of speciality drug launches

First Published:Feb 12, 2019 8:30 AM IST