Sun Pharmaceutical Industries Limited · NSE:SUNPHARMA
Sun Pharmaceutical Industries — Investor Presentation (February 2014)
39 slides from Sun Pharmaceutical Industries's investor presentation, February 2014
Slide 1: Creating Lasting Value
Creating Lasting Value Investor Presentation - February 2014 BSE:524715 • NSE:SUNPHARMA Bloomberg: SUNP@IN • Reuters: SUN.BO www.sunpharma.com
Slide 2: Disclaimer
Disclaimer Except for the historical information contained herein, statements in this presentation and the subsequent discussions, which include words or phrases such as “will”, “aim”, “will likely result”, “would”, “believe”, “may”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “pl
Slide 3: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Revenue Financials Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing Creating Lasting Value - Investor Presentation 3
Slide 4: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Revenue Financials Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing Creating Lasting Value - Investor Presentation 4
Slide 5: Revenue Composition
Revenue Composition 2012-13 Annual Gross Sales : Rs 114,087 million 5 Year CAGR 27% International Generics 5 Year CAGR 47% 13% 54% APIs 7% 5 Year CAGR 17% US Formulations 5 Year CAGR 34% India Branded Generics 26% 5 Year CAGR 15% Finished Dosage International sales 93% sales 72% 5 year CAGR 28% 5 ye
Slide 6: Creating Value, Continuously…
Creating Value, Continuously… ‘83 ‘14 1983 1995 2004 2010 2012 Began with 5 products First API USD 350mn Acquired Dusa Plant Panoli FCCB raised 2013 1993 Acquired 1997 Taro 2007 1994 2011 $7.5Mn invested Acquired URL First Research Centre in Caraco Pharma SPARC, Baroda Demerger JV for Emerging of in
Slide 7: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Revenue Financials Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing Creating Lasting Value - Investor Presentation 7
Slide 8: Strategy and Approach
Strategy and Approach Create sustainable revenue streams Seek cost leadership • Focus: Chronic • Vertical integration : therapies Development through Manufacturing (API and • Differentiation: Finished Dosage) to Marketing Technically complex products • Optimize operational costs • Speed to market Ba
Slide 9: Growing Steadily
Growing Steadily Consistent top-line and bottom-line growth; (Figures in Rs billion) continuing the trend despite increasing size Net Sales EBITDA 49.1 Net Profit 30.1 112.3 14.9 33.6 15.5 8.3 2.5 2.8 2.5 0.6 0.5 97-98 02-03 07-08 12-13 97-98 02-03 07-08 12-13 97-98 02-03 07-08 12-13 9
Slide 10: Sustained Profitability
Sustained Profitability Superior business model Margins consistently higher than peers* Gross Margin EBITDA Margin Net Margin 90% 60% 60% 82% 44 % 32 % 80% 40% 40% 70% 20% 20% 60% 0% - 0% 50% -20% 40% -20% 07-08 08-09 09-10 10-11 11-12 -40% 08-09 09-10 10-11 11-12 12-13 08-09 09-10 10-11 11-12 12-13
Slide 11: Successful At Acquisitions
Successful At Acquisitions Acquired 16 high potential yet under-performing businesses*; successful turnarounds 10,000 45 8 Early Acquisitions 8,000 36 6,000 27 4,000 18 2,000 9 0 0 95-96 96-97 97-98 98-99 99-00 00-01 01-02 02-03 03-04 Net Sales (MINR) Operating Margin(%) Operating Profit (MINR) Crea
Slide 12: Key Deals & Rationale
Key Deals & Rationale Year Deals Country Rationale 2013 Formation of Sun-Intrexon JV US JV for ocular therapies 2013 Acquired URL’s generic business US Adds 107 products to US portfolio 2012 Acquired DUSA Pharma, Inc. US Access to branded derma product 2011 100% ownership of Caraco US Privatization
Slide 13: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Revenue Financials Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing Creating Lasting Value - Investor Presentation 13
Slide 14: India Branded Generics: Strong Base
India Branded Generics : Strong Base • Market Share :5.3%* Others 7 % Neuro-Psychiatry 27 % • Leadership in Opthalmology 5 % chronic segment; Antiasthamatic & Top 3 in over 50% of Antiallergic 4 % more than 500 brands Musculo-Skeletal & Pain 5% Gynecology & Urology 8 % Gastroenterology 14 % Cardiolo
Slide 15: Relentless Customer Focus
Relentless Customer Focus Therapy focused marketing Strong increase • 4,000+ sales representatives in market share covering 140,000 specialist doctors 200 150 100 50 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Cipla Ranbaxy Sun Cadila Lupin DRL Torrent Wockhardt Ipca Year 2000 M
Slide 16: Therapy Focused Marketing
Therapy Focused Marketing Delivering promotional message to specialty customers. Gastroenterology, Orthopedics Cardiology, Diabetology Psychiatry, Neurology Ophthalmology Rheumatology, Asthma, Oncology Fertility, Gynecology, Gynecology Dermatology COPD Urology Creating Lasting Value - Investor Prese
Slide 17: Preferred Choice of Doctors
Preferred Choice of Doctors Leadership in key therapeutic areas* Top 10 Brands contribute 20% of India Sales Specialist Oct ‘10 Oct ‘13 Brand Name Therapy area Psychiatrists 1 1 Neurologists 1 1 Proton pump inhibitor/ Pantocid antiulcerant Cardiologists 1 1 Gemer Oral antidiabetic Orthopaedic 1 1 CV
Slide 18: US Generics
US Generics Integrated generic manufacturer with flexibility for manufacture Approvals onshore / offshore Therapy wise summary Caraco Pharmaceutical Skin, 94 Laboratories Ltd. CNS, 84 The 100% owned US generics subsidiary, markets own and Sun Pharma ANDAs CVS, 42 Sun Pharmaceutical Pain, 29 Industri
Slide 19: ANDA Pipeline: Significant ramp up
ANDA Pipeline : Significant ramp up Products Filed and Approved Status As of Dec’13, ANDAs for 131 468 products await approval 449 (including 14 tentative approvals) 397 377 Sun Pharma 337 84 Products pending 311 250 (with 9 tentative approvals) 225 Caraco & URL 207 177 24 Products pending (with 4 t
Slide 20: Europe Generic Markets
Europe Generic Markets Focused key markets • Working on complex generic products, including injectables • Filings from Indian site Focus Countries An API and Finished Dosage manufacturing site in Hungary with controlled substance capacity Creating Lasting Value - Investor Presentation 20
Slide 21: International Branded Generic Markets
International Branded Generic Markets Semi Regulated Markets Replicating the speciality pipeline • 45 countries Product basket width and technology based products as growth drivers • 866 strong local sales force promotes brands to doctors CIS Countries China Mexico Myanmar Brazil Sri Lanka Focus Mar
Slide 22: Leveraging through Partnership
Leveraging through Partnership • Sun Pharma and Merck establish a Joint Venture for Emerging Markets excluding India • JV to bring new combinations and formulations of incrementally innovative branded generics to market • Opportunity to use SPARC Proprietary Delivery Technologies • Equal representat
Slide 23: Speciality API
Speciality API High Margin Regulated Markets Strong regulatory capability • Business largely with end users in • 252 DMF / CEP filed regulated markets • 172 approved • Over 170 speciality APIs across 8 plants (including Taro) Creating Lasting Value - Investor Presentation 23
Slide 24: Strong Regulatory Capability
Strong Regulatory Capability International level quality processes and documentation 252 239 225 206 168 172 155 154 133 127 81 89 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Dec-13 DMF/CEP Filed DMF/CEP Approved 24
Slide 25: Integrated product dev and manufacturing network
Integrated product dev and manufacturing network Vertically integrated network across four continents enabling high quality, low cost and a quick market entry across the geographies Ontario (Canada) Tiszavasvari Detroit (Hungary) Wilmington M.A. Aurora Cranbury Jammu Bryan Sikkim Plant Tennessee Phi
Slide 26: Finished Dosage Manufacturing
Finished Dosage Manufacturing 18 Manufacturing sites worldwide • India : 6, US : 6 • Canada, Brazil, Mexico, Hungary , Israel, Bangladesh : 1 each • Capacities available for a variety of finished dosage Tablets / Injectables / Sterile Capsules Vials Dry powder Semisolids Ampoules Eye drops Pre-fille
Slide 27: API Manufacturing
API Manufacturing 8 World class locations with all sites ISO 14001, ISO 9002 approved • India : 5, Israel : 1, US : 1, Hungary : 1 Over 25 API processes scaled up annually Panoli & Ahmednagar Hungary & (both India) Tennessee (US) API • International regulatory Key Plants • Controlled substances appr
Slide 28: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Revenue Financials Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing Creating Lasting Value - Investor Presentation 28
Slide 29: Research and Development
Research and Development • Generic R&D spend around 6% of net sales • Strong research teams in generics, finished dosage development, biological support, chemistry • 4 R&D centers with over 900 scientists Mumbai Immediate term Balancing Medium term ANDA, DMF, Products for India the risk Drug deliver
Slide 30: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Revenue Financials Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing Creating Lasting Value - Investor Presentation 30
Slide 31: Corporate Governance
Corporate Governance Our philosophy on corporate governance envisages working towards high levels of transparency, accountability and consistent value systems across all facets of operations Chairman Independent Sun Pharma Directors Israel Makov Keki Mistry Hasmukh Shah Rekha Sethi Former President
Slide 32: Shareholding Pattern
Shareholding Pattern as on Dec 31, 2013 • Rs 1,000 Invested in Individuals and InsuranceCompanies Others the 1994 IPO is 4% 6% currently worth more Bodies Corporate 2% than Rs. 470,000 Financial Inst /Banks 1% Mutual Funds 1% FIIs / Foreign Banks Promoter and 22% promoter group 64% • Total shares ou
Slide 33: Financials
Financials Market Capitalisation Rs. 1,200 billion / US$ 19.5 billion* Figures in Rs million 2008-09 2009-10 2010-11 2011-12 2012-13 P&L Summary Net Sales 42,723 40,075 57,229 80,057 112,389 Gross Profit 34,154 29,096 42,577 63,644 91,592 EBITDA 18,639 13,628 19,518 32,507 49,063 Net Profit 18,177 1
Slide 34: Financial Ratios
Financial Ratios 2008-09 2009-10 2010-11 2011-12 2012-13 Growth (%) Net Sales 27.3 (6.2) 42.8 39.9 40.4 Gross Profit 29.6 (14.8) 46.3 49.5 43.9 EBITDA 20.2 (26.9) 43.2 66.5 50.9 Net Profit 22.2 (25.7) 34.4 46.3 13.2 Net Profit (Adjusted) 22.2 (25.7) 34.4 46.3 # 35.2 Margins (%) Gross Margin 79.9 72.
Slide 35: Key Financials Q3 & 9m FY14
Key Financials Q3 & 9m FY14 Figures in Rs million Q3 FY14 Q3 FY13 CHANGE 9m FY14 9m FY13 CHANGE FY13 Net Sales 42,866 28,520 50% 119,607 81,674 46% 112,389 Gross Profit 35,041 22,927 53% 98,527 66,172 49% 91,592 Gross Margin 82% 80% 82% 81% 81% EBITDA 19,751 12,611 57% 53,340 36,463 46% 49,063 EBITD
Slide 36: Sales Breakup
Sales Breakup Figures in Rs million Q3 FY14 Q3 FY13 CHANGE 9m FY14 9m FY13 CHANGE FY13 Formulation India 9,472 7,885 20% 27,453 21,860 26% 29,657 US 26,789 14,946 79% 72,983 43,659 67% 61,538 ROW 5,207 3,942 32% 14,638 11,333 29% 15,271 Sub-total 41,468 26,773 55% 115,074 76,852 50% 106,466 Bulk 1,7
Slide 37: Recent Developments
Recent Developments • Sun Pharma and Intrexon Form Joint Venture to Develop New Class of Therapeutics for Ocular Diseases • Pipeline of Potential Ocular Therapies to Help Millions Worldwide Suffering from Blinding Diseases • Sun Pharma settled the pending patent litigation in US regarding generic Pr
Slide 38: Revised Guidance for FY14
Revised Guidance for FY14 • Sales growth guidance: Revised to 29% compared to previous guidance of 25% over FY13. Guidance at constant exchange rate • R&D : 6-8% of sales • Capex : Rs 8 bn • ANDAs for 25 products to be filed Creating Lasting Value - Investor Presentation 38
Slide 39: For updates and specific queries, please visit www.sunpharma.com
For updates and specific queries, please visit www.sunpharma.com or feel free to contact Nimish Desai Mira Desai Tel : +91 22 6645 5645, Ext 5717 Tel : +91 22 6645 5645, Ext 5606 Tel Direct : +91 22 66455717 Tel Direct : +91 22 66455606 Mobile : +91 98203 30182 Mobile : +91 98219 23797 nimish.desai@
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