Sun Pharma Q4 Results Preview: Sales Growth Led By gRevlimid, R&D Guidance For FY26 In Focus

Sun Pharmaceutical Industries Ltd. is set to announce its financial results for the January-March quarter on Thursday. Brokerages expect organic growth for the pharma company this quarter, led by gRevlimid sales. Meanwhile, key areas to watch out for would be sales growth and R&D guidance for the financial year ending March 2026.

The imposition of tariffs on US shipments, competition in exclusive products, adverse outcomes of regulatory inspections and the inclusion of more products under NLEM in India remain key risks.

As per Bloomberg estimates, Sun Pharma's consolidated revenue for the March quarter is expected to rise 12.9% year-over-year to Rs 13,254.38 crore, compared to Rs 11,813.33 crore a year ago.

The company's net profit is expected to rise 5.24% to Rs 2,793.94 crore for the quarter.

Ebitda is likely to rise 18.08% to Rs 3,650.55 crore from Rs 3,091.53 crore, while margin is expected to expand to 27.5% from 26.2% a year ago.

Sun Pharma Q4 Preview (Consolidated, YoY)

• Revenue seen 12.19% higher at Rs 13,254.38 crore versus Rs 11,813.33 crore.

• Net profit seen 5.24% higher at Rs 2,793.94 crore versus Rs 2,654.58 crore.

• Ebitda seen 18.08% higher at Rs 3,650.55 crore versus Rs 3,091.53 crore.

• Margin seen at 27.5% versus 26.2%.

Brokerage Views 

JP Morgan| Target Price: Rs 2,210

• The brokerage expects healthy growth in India (+13% year-on-year) and EMs & RoW (+12% year-on-year).

• Secondary sales growth in India is tracking at 10.1% year-on-year in QTD, a 380 bps outperformance versus the Indian Pharma Market, or IPM.

• For FY25, we expect Sun to clock 14% year-on-year growth in India, the highest in our coverage.

• JP Morgan expects US revenues to grow 10% year-on-year and 11% quarter-on-quarter driven by gRevlimid.

• The brokerage further expects Ebitda margins to improve to 27.9% (+210 bps year-on-year), partly due to a high cost base (higher R&D spends and concert integration costs).

• Management commentary on the Leqselvi launch, checkpoint acquisition and progress on plant resolution of Halol, Mohali and Dadra will be key.

Axis Capital

• US sales expected at $534 million (+13% quarter-on-quarter) driven by gRevlimid sales, continued traction in speciality partly offset by price erosion in generics.

• India business expected to clock 10% growth for Q4 (+11% as per IQVIA).

• RoW+ emerging markets to see a combined low-teen growth.

• Adjusted margins are expected to remain flat quarter-on-quarter at 28.3%.

BofA | Target Price: Rs 1,687.55

• BofA's price objective of Rs 1,780 is based on 30 times FY27 estimated P/E for base business and Rs 61 per share for earnings from Concert Therapeutics acquisition.

• The speciality-driven earnings visibility should support the premium versus peers that are largely dependent on generics.

• Key downside risks include slower-than-expected growth in the three key speciality assets, delay in Deuruxo's launch and slower ramp-up, high R&D and SG&A investment for growth capping margins, and delay in pipeline progress reducing comfort on valuations.

• Key upside risks include a faster than expected ramp-up in Winlevi revenue and the launch of deuruxo, positive data readout for Ilumya for PsA and speciality-related business development deals with commercial/nearly commercial assets.

HSBC| Rating: Buy |Target Price: Rs 1,970

• HSBC values Sun Pharma's base business by discounting the one-year forward fair value, which is based on our target PE multiple of 35x (Gordon growth-based PE multiple; unchanged) applied to our March 2027 EPS estimate of Rs 58.32 (from Rs 59.37).

• The brokerage adds an NPV of Rs 85 per share (unchanged) for speciality products to the base business value to arrive at our fair value target price of Rs 1,970.00 (from Rs 2,000.00).

• The brokerage's NPV captures the value of Ilumya, Cequa, Winlevi and Leqselvi beyond our explicit estimates for FY25-27e.

• HSBC's valuation PE multiple remains unchanged at 35x. The brokerage's target price implies 16.7% upside from the current share price.

• It maintains its buy rating on the stock because of the solid outlook on the company's speciality portfolio sales.

• We believe Sun Pharma will benefit from the consistent improvement in profitability of its speciality portfolio and consequent operating leverage benefit at the consolidated margin.