Sun Pharmaceutical Industries CMP Rating: Target price: Rs. 779 …mailers.sparkcapital.in/uploads/Harith/Updates/Sun... · 2016-09-21 · Sun Pharmaceutical Industries CMP Rs. 779

Sun Pharmaceutical Industries CMP

Rs. 779

Target

Rs. 796

Rating

REDUCE

Page 1

Stock performance

1m 3m 12m

SUNP -1% 5% -14%

Sensex 2% 6% 9%

BSETHC 3% 11% -5%

Financial Summary (Consolidated)

Year Revenues (Rs. mn) EBITDA margin % PAT (Rs. mn) EPS (Rs.) P/E(x) EV/EBITDA(x) ROE ROCE

FY16 282,697 29.4% 54,011 22.4 34.7 22.0 18.9% 17.2%

FY17E 319,190 32.9% 68,087 28.4 27.5 17.4 20.5% 18.2%

FY18E 364,594 31.4% 75,669 31.5 24.7 16.0 19.8% 17.8%

FY19E 403,527 32.1% 86,665 36.1 21.6 14.1 19.2% 17.7%

Date 21 Sep 2016

Market Data

SENSEX 28523

Nifty 8776

Bloomberg SUNP IN

Shares o/s 2,407mn

Market Cap Rs. 1,874bn

52-wk High-Low Rs. 934-704

3m Avg. Daily Vol Rs. 2,724mn

Index member BSE Sensex

Latest shareholding %

Promoters 55.0

Institutions 35.4

Public 9.7

Company Update

Dr HARITH AHAMED [email protected] +91 44 4344 0052

KRISHNA KIRAN KONDURI [email protected] +91 44 4344 0037Find Spark Research on Bloomberg (SPAK <go>),

Thomson First Call, Reuters Knowledge and Factset

Pricing concerns at Taro; downgrade to REDUCE

Taro’s rising contribution to SUNP’s profitability: Taro Pharmaceuticals, SUNP’s 72%-owned subsidiary in the US,

has been a key contributor to SUNP’s performance in recent years. In FY16, Taro accounted for 45% of SUNP’s

consolidated PAT, up from 7% in FY11

Generic derma – strong growth despite muted volumes: Taro operates primarily in the US generic dermatology

segment, which accounted for ~2/3rd of its FY16 sales. Taro is among the largest players in the segment with a ~15%

share of the market. The US generic derma market, currently estimated at ~$6bn, has grown at a CAGR of 19% in the

last 3 years, despite a volume decline of 2%. The market has witnessed significant price increases across products in

the last 3-4 years, with Taro leading price increases for many drugs. Entry barriers from longer development timelines

and higher costs have meant more gradual entry of new players when compared to other generic segments

Significant price increases across Taro’s portfolio: Price increases across its derma portfolio has been a key driver

for Taro’s strong performance in recent years. For instance, clobetasol propionate, Taro’s top product, accounting for

~11% of sales in FY16, has witnessed price increases of >12x between 2013 and 2015. Sustainability of Taro’s price

increase-driven performance has been a key concern for investors in SUNP

ANDA approvals picking up, to impact pricing negatively: Our analysis shows a significant pick up in generic

derma ANDA approvals in the past ~12 months. With several players ramping up ANDA filings in the segment over the

past few years, we expect approval trends to pick up further from current levels. Taro’s Rx shares across top products

have shown a flat-to-declining trend in recent months

Recent DoJ subpoena adds to Taro’s pricing concerns: We observe negative yoy and sequential pricing trends for

Taro’s key derma products. The recent subpoena from US DoJ Antitrust Division to Taro seeking details related to drug

pricing has added to our concerns on sustainability of Taro’s price increases. We believe the heightened scrutiny will

make it difficult for Taro to implement further price hikes. Taro’s significantly superior margins (vs. generic peers) are

unlikely to sustain in a tougher generic derma pricing environment

Valuation: We lower our PAT estimates for Taro by 1%/3% for FY17/FY18, while leaving our estimates for Sun ex

Taro unchanged. For Sun ex Taro, we continue to factor 2HFY17 resolution of Halol Warning Letter and significant

margin improvement in FY16-18 from Ranbaxy synergies, in-line with consensus. Our revised target price of Rs. 796 is

24x FY18E EPS of Rs. 31.5 plus Rs. 40 per share for tildrakizumab opportunity. Downgrade to REDUCE

Rating: ▼ Target price: ▼ EPS: ▼


Rs. 779

Target

Rs. 796

Rating

REDUCE

Page 2

88%80% 80% 76% 75% 74%

82%

61% 60% 56%45% 43% 41% 40% 36%

28%

Gilead Amgen Pfizer BMS Eli Lilly Merck Taro Akorn DrReddy's

Lannett Mylan Sandoz Impax Perrigo Endo Sagent

Gross margin %

Significantly superior margins vs. generic peers

Source: Company data, Bloomberg, Spark Capital Research

Price increases drive significant margin expansion for Taro

Source: Company data, Spark Capital Research; *FY11: year-ending Dec-10, FY12: year

ending Dec-11

Taro accounted for 45% of SUNP’s consolidated PAT in FY16

Source: Company data, Spark Capital Research

59%65%

74% 76% 78%82%

27%

44%52%

59%63%

66%

FY11* FY12* FY13 FY14 FY15 FY16

Gross margin % EBITDA margin %

Rs. Mn FY13 FY14 FY15 FY16

Taro 36,498 46,121 52,869 62,342

Ex Taro 76,500 114,683 221,465 220,355

Revenue 112,999 160,804 274,334 282,697

Taro 18,844 27,216 33,336 41,308

% margin 51.6% 59.0% 63.1% 66.3%

Ex Taro 30,118 44,685 46,299 41,931

% margin 39.4% 39.0% 20.9% 19.0%

EBITDA 48,962 71,901 79,635 83,239

% margin 43.3% 44.7% 29.0% 29.4%

Taro 14,507 22,010 29,762 35,476

Ex Taro 20,187 16,780 25,120 22,828

PAT 34,693 38,790 54,882 58,304

Minority interest (4,863) (7,375) (9,488) (11,145)

PAT after minority 29,831 31,415 45,394 47,159

Adjusted PAT after minority 34,590 56,589 47,771 54,011

Taro - % contribution to SUNP’s

adj. PAT28% 27% 43% 45%

Taro’s rising contribution to SUNP’s profitability

Innovators Generics


Rs. 779

Target

Rs. 796

Rating

REDUCE

Page 3

14 13

18

25

30

2012 2013 2014 2015 YTD 2016

No. of derma ANDAs approved by FDA

Taro has the highest number of derma ANDA approvals

Source: USFDA, Spark Capital Research

8481 79

36 34

2519 19

Taro Sandoz Perrigo G and W Actavis Glenmark Tolmar Akorn

Cumulative derma ANDA approvals

Generics accounts for ~43% of the ~$13bn US dermatology market

Source: IMS Health, Spark Capital Research; *includes OTC

Taro is the 2nd largest player in the US generic derma market

Source: IMS Health, Spark Capital Research

US generic dermatology market – overview

Branded23%

Branded generics

26%

Generics43%

Other*8%

Significant pick up in derma ANDA approvals

Source: USFDA, Spark Capital Research

0

200

400

600

800

1,000

Sandoz Taro Perrigo Akom Impax Actavis

US generic derma sales ($mn)


Rs. 779

Target

Rs. 796

Rating

REDUCE

Page 4

Taro’s Rx shares across top products have shown a flat-to-declining trend in recent months


Taro’s generic derma launch pipeline – new launches to offset price erosions partially


Taro – Rx and pricing trends

Taro’s key derma products – negative yoy pricing trends

Source: Company data, Medicaid, Spark Capital Research

Active ingredient Form No. of players Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Aug-16

carbamazepine Tablet 5 45.9% 43.7% 43.7% 38.8% 33.9% 33.0% 31.8% 30.5% 30.4%

carbamazepine XR tablet 2 39.2% 39.2% 43.1% 41.1% 42.7% 38.6% 37.1% 44.4% 44.2%

clobetasol Cream 3 43.1% 32.2% 30.5% 20.3% 25.9% 27.0% 26.6% 25.6% 25.4%

clobetasol Ointment 4 37.5% 30.9% 27.9% 19.0% 20.9% 21.9% 23.2% 22.7% 23.2%

clomipramine Capsule 5 30.5% 30.1% 30.5% 30.0% 29.3% 28.3% 26.9% 27.2% 26.0%

desoximetasone Cream 3 61.1% 60.7% 56.9% 54.3% 52.5% 52.5% 53.7% 52.1% 49.4%

ketoconazole Cream 3 37.1% 37.1% 39.3% 38.8% 36.0% 33.5% 35.9% 38.5% 39.5%

lidocaine Ointment 6 33.8% 29.8% 10.8% 7.0% 21.8% 24.9% 23.3% 19.9% 18.8%

nystatin + triamcinolone acetonide Cream 3 65.1% 65.4% 65.4% 63.6% 61.7% 55.3% 54.6% 51.2% 50.6%

warfarin Tablet 10 44.0% 44.0% 43.4% 39.9% 38.6% 38.2% 37.8% 36.6% 35.7%

fluocinonide Cream 4 57.8% 48.1% 44.1% 39.7% 38.0% 38.5% 37.1% 33.8% 35.3%

clotrimazole + betamethasone Cream 5 27.0% 25.3% 24.8% 22.7% 23.1% 22.4% 21.7% 28.6% 29.8%

metronidazole Gel 4 25.5% 29.4% 31.3% 29.7% 29.4% 30.1% 34.2% 42.7% 43.8%

Active ingredient Brand Form Launch dateMarket

size $mn

No. of

players*

adapalene Differin Gel Jun-16 90 4

diclofenac sodium Solaraze Gel Apr-16 300 5

fluocinolone acetonide Derma-Smoothe Oil May-16 20 5

naftifine hydrochloride (1%) Naftin Cream Sep-16 13 2

naftifine hydrochloride (2%) Naftin Cream Jan-16 35 2

oxiconazole nitrate Oxistat Cream May-16 30 2

tacrolimus Protopic Ointment On approval 100 2

clindamycin + benzoyl peroxide (1.2%/5%) Duac Gel On approval 50 3

clindamycin + benzoyl peroxide (1%/5%) BenzaClin Gel On approval 200 3

mupirocin calcium (2%) Bactroban Cream On approval 40 2

tazarotene (0.1%) Tazorac Cream On approval 50 1

clocortolone pivalate (0.1%) Cloderm Cream On approval 20 1

Active ingredient Form Sep-14 Sep-15 Sep-16

clobetasol Ointment 1.0 0.8 0.6

clobetasol Cream 1.0 0.9 0.8

desoximetasone Cream 1.0 1.2 1.3

ketoconazole Cream 1.0 1.3 1.8

lidocaine Ointment 1.0 4.1 2.1

nystatin + triamcinolone Cream 1.0 0.9 0.8

fluocinonide Cream 1.0 1.2 1.1

clotrimazole +

betamethasoneCream 1.0 0.8 0.6

metronidazole Gel 1.0 0.8 0.8


Rs. 779

Target

Rs. 796

Rating

REDUCE

Page 5

We estimate 4% CAGR for Taro’s US sales in FY16-19E

Taro – US sales – muted growth in FY16-19E


SUNP – earnings downgrades over past 12 months


Sharp de-rating of Taro’s stock due to pricing-related concerns


Key estimate revision (Consolidated)


9x10x11x12x13x14x

50

100

150

200

Oct-13 Mar-14 Aug-14 Jan-15 Jun-15 Nov-15 Apr-16 Sep-16

12M fwd P/E

CM

P (

$)

35.9

29.7

42.8

35.4

20

25

30

35

40

45

Sep-15 Nov-15 Jan-16 Mar-16 May-16 Jul-16 Sep-16

Consensus EPS (Rs.) - FY17E Consensus EPS (Rs.) - FY18E

(Rs. mn)FY17E FY18E

Old New Change Old New Change

Revenues 320,833 319,190 -0.5% 368,193 364,594 -1.0%

EBITDA 106,334 105,022 -1.2% 118,330 114,540 -3.2%

Margin (%) 33.1% 32.9% 32.1% 31.4%

PAT 68,775 68,087 -1.0% 78,073 75,669 -3.1%

EPS (Rs.) 28.7 28.4 -1.0% 32.5 31.5 -3.1%

588 669

777 865 871

920 963

FY13 FY14 FY15 FY16 FY17E FY18E FY19E

Taro - US sales ($mn)


Rs. 779

Target

Rs. 796

Rating

REDUCE

Page 6

Taro – Financial Summary

Abridged Financial Statements (Consolidated) Key metrics

$mn FY15 FY16 FY17E FY18E FY19E FY15 FY16 FY17E FY18E FY19E

Profit & Loss Growth ratios

Revenue 863 951 956 1,012 1,057 Revenue 13.7% 10.2% 0.5% 5.9% 4.5%

EBITDA 543 629 603 618 635 EBITDA 21.6% 15.8% -4.3% 2.5% 2.8%

Depreciation (16) (15) (16) (17) (18) Adjusted PAT 34.4% 11.7% -7.4% 2.6% 2.2%

EBIT 528 614 587 601 617 Margin ratios

Other Income 55 23 14 24 30 EBITDA 63.0% 66.2% 63.1% 61.1% 60.1%

Interest expenses (1) (0) 0 0 0 Adjusted PAT 56.1% 56.9% 52.4% 50.8% 49.7%

Exceptional items - - - - - Performance ratios

PBT 582 637 601 624 647 RoE 39.9% 32.4% 24.3% 21.0% 17.7%

PAT (after minority interest) 484 541 501 514 525 RoCE 39.5% 32.3% 24.3% 20.9% 17.7%

Adjusted PAT (after minority interest) 484 541 501 514 525 RoA 32.4% 27.9% 21.8% 19.0% 16.2%

Balance Sheet Fixed asset turnover (x) 1.9 2.1 2.0 2.0 2.0

Net Worth 1,417 1,937 2,197 2,711 3,236 Total asset turnover (x) 0.6 0.5 0.4 0.4 0.3

Deferred Tax (2) (2) (2) (2) (2) Financial stability ratios

Total debt 6 0 0 0 0 Net Debt to Equity (x) (0.6) (0.6) (0.7) (0.7) (0.7)

Other liabilities and provisions 293 230 241 253 266 Net Debt to EBITDA (x) (1.7) (2.0) (2.4) (3.1) (3.8)

Total Networth and liabilities 1,714 2,165 2,437 2,962 3,500 Current ratio (x) 1.9 2.7 2.6 2.7 2.6

Gross Fixed assets 456 463 492 521 550 Inventory and debtor days 145 145 145 145 145

Net fixed assets 173 175 188 200 211 Working capital days 137 138 138 138 138

Investments 0 0 0 0 0 Interest cover (x) 569 1,299 NA NA NA

Cash and ST investments 920 1,229 1,466 1,938 2,426 Valuation metrics

Loans & advances and other assets 297 403 423 443 464 Fully Diluted Shares (mn) 42.8 42.8 41.0 41.0 41.0

Net working capital 323 358 360 381 398 Market cap ($mn) 5,007

Total assets 1,714 2,165 2,437 2,962 3,500 Adjusted EPS ($) 11.3 12.6 12.2 12.5 12.8

Cash Flows P/E (x) 10.3 9.3 9.6 9.3 9.1

Cash flows from Operations 407 395 495 480 490 EV ($mn) 3,547

Capex (20) (19) (29) (29) (29) EV/ EBITDA (x) 6.5 5.6 5.9 5.7 5.6

Cash flows from Investing (92) (285) (17) (8) (1) BV/ share ($) 33.0 45.1 53.4 65.9 78.7

Cash flows from Financing (11) (15) (241) 0 0 Price to BV (x) 3.5 2.6 2.2 1.8 1.5


Rs. 779

Target

Rs. 796

Rating

REDUCE

Page 7

SUNP – Financial Summary (Consolidated)

Abridged Financial Statements (Consolidated) Key metrics

Rs. mn FY15 FY16 FY17E FY18E FY19E FY15 FY16 FY17E FY18E FY19E

Profit & Loss Growth ratios

Revenue 274,334 282,697 319,190 364,594 403,527 Revenue 70.6% 3.0% 12.9% 14.2% 10.7%

EBITDA 79,635 83,239 105,022 114,540 129,425 EBITDA 10.8% 4.5% 26.2% 9.1% 13.0%

Depreciation (11,947) (10,135) (13,481) (14,852) (16,353) Adjusted PAT -15.6% 13.1% 26.1% 11.1% 14.5%

EBIT 67,688 73,104 91,541 99,687 113,072 Margin ratios

Other Income 4,508 6,170 4,873 5,817 7,050 EBITDA 29.0% 29.4% 32.9% 31.4% 32.1%

Interest expense (5,790) (4,769) (4,649) (3,570) (3,230) Adjusted PAT 17.4% 19.1% 21.3% 20.8% 21.5%

Exceptional items (2,378) (6,852) - - - Performance ratios

PBT 64,029 67,653 91,765 101,935 116,892 RoE 21.6% 18.9% 20.5% 19.8% 19.2%

PAT (after minority interest) 45,394 47,159 68,087 75,669 86,665 RoCE 20.8% 17.2% 18.2% 17.8% 17.7%

Adjusted PAT (after minority interest) 47,771 54,011 68,087 75,669 86,665 RoA 13.5% 11.7% 13.6% 13.6% 14.0%

Balance Sheet Fixed asset turnover (x) 1.6 1.1 1.2 1.2 1.3

Net Worth 284,893 354,901 399,890 474,243 559,080 Total asset turnover (x) 0.8 0.6 0.6 0.7 0.7

Deferred Tax (17,516) (21,259) (21,260) (21,260) (21,260) Financial stability ratios

Total debt 89,939 85,184 65,408 59,184 32,633 Net Debt to Equity (x) (0.1) (0.2) (0.2) (0.3) (0.4)

Other liabilities and provisions 82,924 66,598 75,227 77,332 79,507 Net Debt to EBITDA (x) (0.5) (0.7) (0.9) (1.3) (1.6)

Total Networth and liabilities 440,239 485,425 519,265 589,500 649,960 Current ratio (x) 3.5 3.8 3.7 3.7 3.6

Gross Fixed assets 224,455 269,148 285,549 306,459 327,370 Inventory and debtor days 147 174 175 175 176

Net fixed assets 147,211 175,417 179,850 185,909 190,467 Working capital days 105 128 128 128 127

Investments 5,989 5,933 5,933 5,933 5,933 Interest cover (x) 11.7 15.3 19.7 27.9 35.0

Cash and ST investments 131,155 147,045 161,624 206,030 245,396 Valuation metrics

Loans & advances and other assets 77,620 59,730 62,847 65,933 69,172 Fully Diluted Shares (mn) 2,406 2,407 2,400 2,400 2,400

Net working capital 78,265 97,299 109,010 125,696 138,991 Market cap (Rs.mn) 1,874,213

Total assets 440,239 485,425 519,265 589,500 649,960 Adjusted EPS (Rs.) 19.9 22.4 28.4 31.5 36.1

Cash Flows P/E (x) 39.2 34.7 27.5 24.7 21.6

Cash flows from Operations 53,219 67,694 77,694 79,575 94,014 EV (Rs.mn) 1,828,463

Capex (23,659) (44,538) (17,914) (20,911) (20,911) EV/ EBITDA (x) 23.0 22.0 17.4 16.0 14.1

Cash flows from Investing (26,710) (44,549) (13,477) (15,270) (14,037) BV/ share (Rs.) 106.6 130.4 145.6 172.6 203.9

Cash flows from Financing (10,875) (19,243) (34,072) (19,899) (40,610) Price to BV (x) 7.3 6.0 5.3 4.5 3.8

Sun Pharmaceutical Industries – Crystal Ball Gazing

In the long-term, we

are positive on Sun’s

recent steps towards

establishing a branded

business in the US

focused on

dermatology and

ophthalmology. We

believe in-licensing of

tildrakizumab (novel

biologic for plaque

psoriasis), acquisition

of InSite Vision and in-

licensing of SPARC

products (Xelpros,

Elepsia) are steps in

the right direction. We

expect margins to

improve substantially

as production

improves at Halol and

Ranbaxy integration

progresses towards

completion. In the

near-to-medium term,

we expect earnings to

be under pressure as

the US business

witnessing pricing

pressure.

10% CAGR growth in

the US and 14%

domestic

formulations

businesses. The

growth in these

segments driven by

new products

launches

~12% revenue

CAGR in FY16-

20E driven by

P/E multiple FY20E EPS Price target

22x 42.1 942 ▲

24x 42.1 1026

Entry = Rs. 779 @ 25x FY18E EPS

Cumulative Dividends of

Rs. 16

Earnings CAGR of 17% in FY16-20E,

exit multiple of 24x

TOTAL RETURN OF

1.3x

Rs.mn FY11 FY15 FY16 FY17E FY18E FY19E FY20E

US 22,075 137,196 135,169 151,020 166,990 181,068 198,124

India 23,801 67,166 72,992 80,061 92,070 105,880 122,821

RoW 6,907 23,320 21,618 20,587 34,095 37,101 40,518

Emerging

markets0 37,326 35,843 41,597 46,583 52,173 58,434

APIs 5,212 9,910 14,025 17,361 19,097 21,007 23,107

FY11 FY15 FY16 FY17E FY18E FY19E FY20E

Revenues 57,279 274,334 282,697 319,190 364,594 403,527 449,892

EBITDA 19,631 79,635 83,239 105,022 114,540 129,425 148,416

Adj. PAT 18,193 47,771 54,011 68,087 75,669 86,665 101,047

Adj. EPS 8.8 19.9 22.4 28.4 31.5 36.1 42.1

Revenues and Adj.

PAT to grow at a

CAGR of 12% and

17% respectively, in

FY16-20E

Expect multiple to

sustain on healthy

earnings growth

FY11-16 CAGR %

Revenue EBITDA Adj. PAT Price

38% 34% 24% 36%

Trading History – % of times stock traded

PE range<20x 20x-22x 22x-24x 24x-26x >26x

14% 39% 21% 17% 9%


Rs. 779

Target

Rs. 796

Rating

REDUCE

Page 9

Spark Disclaimer

Spark Capital Advisors (India) Private Limited (Spark Capital) and its affiliates are engaged in

investment banking, investment advisory and institutional equities and infrastructure advisory

services. Spark Capital is registered with SEBI as a Stock Broker and Category 1 Merchant Banker.

We hereby declare that our activities were neither suspended nor we have defaulted with any stock

exchange authority with whom we are registered in the last five years. We have not been debarred

from doing business by any Stock Exchange/SEBI or any other authorities, nor has our certificate of

registration been cancelled by SEBI at any point of time.

Absolute Rating Interpretation

BUY Stock expected to provide positive returns of >15% over a 1-year horizon

ADD Stock expected to provide positive returns of >5% – <15% over a 1-year horizon

REDUCE Stock expected to provide returns of <5% – -10% over a 1-year horizon

SELL Stock expected to fall >10% over a 1-year horizon

Spark Capital has a subsidiary Spark Investment Advisors (India) Private Limited which is engaged in the services of providing investment advisory services and is registered with SEBI as

Investment Advisor. Spark Capital has also an associate company Spark Infra Advisors (India) Private Limited which is engaged in providing infrastructure advisory services.

This document does not constitute or form part of any offer or solicitation for the purchase or sale of any financial instrument or as an official confirmation of any transaction. This document is

provided for assistance only and is not intended to be and must not alone be taken as the basis for an investment decision. Nothing in this document should be construed as investment or financial

advice, and nothing in this document should be construed as an advice to buy or sell or solicitation to buy or sell the securities of companies referred to in this document.

Each recipient of this document should make such investigations as it deems necessary to arrive at an independent evaluation of an investment in the securities of companies referred to in this

document (including the merits and risks involved), and should consult its own advisors to determine the merits and risks of such an investment. This document is being supplied to you solely for

your information and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published, copied, in whole or in part, for any purpose. This report is not

directed or intended for distribution to or use by any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such distribution, publication,

availability or use would be contrary to law, regulation or which would subject Spark Capital and/or its affiliates to any registration or licensing requirement within such jurisdiction. The securities

described herein may or may not be eligible for sale in all jurisdictions or to a certain category of investors. Persons in whose possession this document may come are required to inform themselves

of and to observe such applicable restrictions. This material should not be construed as an offer to sell or the solicitation of an offer to buy any security in any jurisdiction where such an offer or

solicitation would be illegal.

Spark Capital makes no representation or warranty, express or implied, as to the accuracy, completeness or fairness of the information and opinions contained in this document. Spark Capital , its

affiliates, and the employees of Spark Capital and its affiliates may, from time to time, effect or have effected an own account transaction in, or deal as principal or agent in or for the securities

mentioned in this document. They may perform or seek to perform investment banking or other services for, or solicit investment banking or other business from, any company referred to in this

report.

0

200

400

600

800

1,000

1,200

1,400

Sep-13 Mar-14 Sep-14 Mar-15 Sep-15 Mar-16 Sep-16

Rs.

Price Target

Sun Pharma – 3 Year Price and Rating History Report Date Price Target Reco.

16/Aug/16 801 817 Add

01/Jun/16 763 792 Add

28/Mar/16 846 911 Add

15/Feb/16 847 944 Buy

04/Jan/16 816 910 Buy

12/Aug/15 840 915 Add

15/Jun/15 814 901 Add

14/Aug/14 803 830 Add

27/Jun/14 628 693 Add

02/Jun/14 587 670 Buy

08/Apr/14 572 681 Buy

17/Feb/14 609 700 Buy

06/Jan/14 580 673 Buy


Rs. 779

Target

Rs. 796

Rating

REDUCE

Page 10

Disclaimer (Cont’d)

This report has been prepared on the basis of information, which is already available in publicly accessible media or developed through an independent analysis by Spark Capital. While we would

endeavour to update the information herein on a reasonable basis, Spark Capital and its affiliates are under no obligation to update the information. Also, there may be regulatory, compliance or

other reasons that prevent Spark Capital and its affiliates from doing so. Neither Spark Capital nor its affiliates or their respective directors, employees, agents or representatives shall be

responsible or liable in any manner, directly or indirectly, for views or opinions expressed in this report or the contents or any errors or discrepancies herein or for any decisions or actions taken in

reliance on the report or the inability to use or access our service in this report or for any loss or damages whether direct or indirect, incidental, special or consequential including without limitation

loss of revenue or profits that may arise from or in connection with the use of or reliance on this report.

Spark Capital and/or its affiliates and/or employees may have interests/positions, financial or otherwise in the securities mentioned in this report. To enhance transparency, Spark Capital has

incorporated a disclosure of interest statement in this document. This should however not be treated as endorsement of views expressed in this report:

Disclosure of Interest Statement SUNP

Analyst financial interest in the company No

Group/directors ownership of the subject company covered Yes

Investment banking relationship with the company covered No

Spark Capital’s ownership/any other financial interest in the company covered No

Associates of Spark Capital’s ownership more than 1% in the company covered No

Any other material conflict of interest at the time of publishing the research report No

Receipt of compensation by Spark Capital or its Associate Companies from the subject company covered for in the last twelve months:

Managing/co-managing public offering of securities

Investment banking/merchant banking/brokerage services

Products or services other than those above

In connection with research report

No

Whether Research Analyst has served as an officer, director or employee of the subject company covered No

Whether the Research Analyst or Research Entity has been engaged in market making activity of the Subject Company; No

Analyst Certification of Independence

The views expressed in this research report accurately reflect the analyst’s personal views about any and all of the subject securities or issuers; and no part of the research analyst’s

compensations was, is or will be, directly or indirectly, related to the specific recommendation or views expressed in the report.

Additional Disclaimer for US Institutional Investors

This research report prepared by Spark Capital Advisors (India) Private Limited is distributed in the United States to US Institutional Investors (as defined in Rule 15a-6 under the Securities

Exchange Act of 1934, as amended) only by Auerbach Grayson, LLC, a broker-dealer registered in the US (registered under Section 15 of Securities Exchange Act of 1934, as amended).

Auerbach Grayson accepts responsibility on the research reports and US Institutional Investors wishing to effect transaction in the securities discussed in the research material may do so through

Auerbach Grayson. All responsibility for the distribution of this report by Auerbach Grayson, LLC in the US shall be borne by Auerbach Grayson, LLC. All resulting transactions by a US person or

entity should be effected through a registered broker-dealer in the US. This report is not directed at you if Spark Capital Advisors (India) Private Limited or Auerbach Grayson, LLC is prohibited or

restricted by any legislation or regulation in any jurisdiction from making it available to you. You should satisfy yourself before reading it that Auerbach Grayson, LLC and Spark Capital Advisors

(India) Private Limited are permitted to provide research material concerning investment to you under relevant legislation and regulations.

Documents

Sun Pharmaceutical Industries CMP Rating: Target price: Rs. 779 …mailers.sparkcapital.in/uploads/Harith/Updates/Sun... · 2016-09-21 · Sun Pharmaceutical Industries CMP Rs. 779