Sun Pharma clocks 12% turnover, 14% PAT increase in Q2

Chennai: The drug major Sun Pharmaceutical Industries has declared an 11.9-per cent turnover and 14-per cent profit after tax (PAT) increase for the half year ended 30 September 2002. On a turnover of Rs 406 crore (H1 01-02: Rs 363 crore), the company's PAT stands at Rs 101 crore (H1 01-02: Rs 88.9 crore).

While domestic sales generated a revenue of Rs 339 crore (formulations: Rs 272 crore; bulk drug: Rs 67 crore), exports amounted to Rs 67 crore (formulations: Rs 17 crore; bulk drug Rs 50 crore). A Sun official says the international bulk actives business showed a lower growth than in the previous year, largely due to the exit from the commodity cephalosporin business.

The company launched 18 new products during the period under review, important among which were: antipsychotics Zypsidon and Qutipin; the once-a-week antidepressant formulation Prodep LA; the once-a-month anticancer / endometriosis product Lupride Depot; Surfact for neonatal respiratory distress; and Rilutor for the neurological disorder ALS.

Six of the new products used a non-conventional delivery platform such as controlled / extended release, biodegradable membrane or formulation complexity.

For the period under review, the research and development (R&D) spend went up to Rs 34.2 crore as against Rs 13 crore incurred during the first of the previous year. Sun Pharma will be operationalising two more facilities: 200,000 sq ft / 150 scientists / 16 acres in Baroda for an R&D campus and a 75,000-sq ft new product development centre in Mumbai.

Sun Pharma chairman and managing director Dilip Shanghvi says: “We continue to invest in long-gestation projects, both in research and in the international markets. Some of the longer-term projects have reached market and have begun to find good acceptance, such as the biodegradable membrane product Lupride Depot and the neonatal emergency product Surfact. Several more delivery system-based products are close to launch. These technology-based products would, in the future, value-add the quality of earning for the company.“

The company's board, meanwhile, has approved an equity buyback plan. As per the plan, the company will buy back 20-lakh shares at a maximum of Rs 750 per share from the open market through the stock exchange route. The board has capped the outlay for the buyback at Rs 120 crore.

In addition, the board has also recommended a stock split (subdivision) of its equity shares of Rs 10 each into two equity shares of Rs 5 each. Post-split, the number of shares which can be bought back will stand increased to 40 lakh subject to the maximum price of Rs 375. However, the total cap on the outlay for the buyback stands unchanged at Rs 120 crore.

Caraco Pharmaceutical Labs, the company's US affiliate, has recently reported a turnaround with net sales of $14.83 million ($3.3 million in the previous year) and a net loss at $0.18 million ($5.13 million in the previous year) for the first nine months of 2002. This net loss is after charging off a non-cash item of $1.25 million for shares issued to Sun Pharma for technology transfer.