Sun Pharmaceutical Industries Limited · NSE:SUNPHARMA
Sun Pharmaceutical Industries — Investor Presentation (November 2010)
41 slides from Sun Pharmaceutical Industries's investor presentation, November 2010
Slide 1: Creating Lasting Value
Creating Lasting Value Investor Presentation – November 2010 Sun Pharmaceutical Industries Limited Corporate Office: Acme Plaza, Andheri Kurla Road, Andheri (E), Mumbai - 400 059. Tel: 91-22-66969696 ▪ Fax: 91-22- 28212010 ▪ 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 Financials Revenue Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing 3 Creating Lasting Value - Investor Presentation
Slide 4: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Financials Revenue Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing 4 Creating Lasting Value - Investor Presentation
Slide 5: Revenue Composition
Revenue Composition 2009-10 Annual sales : USD 909 million 5 Year CAGR 26% India 45% Branded Generics 5 Year CAGR 22% APIs 13% 5 Year CAGR 19% 12% 30% International Branded US Generics Generics (ex-US) 5 Year CAGR 33% 5 Year CAGR 43% Finished International Dosage sales 53% sales 87% 5 year CAGR 34%
Slide 6: Proforma Revenue Composition (with Taro)
Proforma Revenue Composition (with Taro) 2009- 10 Proforma Annual sales : $ 1.27 billion India Branded Generics 32% US Generics APIs 10% 44% 14% International Formulation (ex-US) 6 Creating Lasting Value - Investor Presentation
Slide 7: Creating Value, Continuously…
Creating Value, Continuously… ‘83 ‘10 1995 1983 2004 2010 Began with 5 products First API 1993 USD 350mn 2007 Plant Panoli FCCB raised Acquired Taro 1997 First Research Centre 1994 Demerger SPARC, Baroda of innovative $7.5Mn invested R&D to SPARC in Caraco IPO - Rs. 550 Mn raised Sun Pharma Today PA
Slide 8: Key Operating Subsidiaries
Key Operating Subsidiaries Sun Pharmaceutical Industries Limited Caraco Pharmaceutical Sun Pharmaceutical Taro Pharmaceutical Laboratories Industries, Inc. (SPI) Industries Ltd. Develops, manufactures, US based wholly owned Multinational science market and distributes subsidiary of Sun based pharmac
Slide 9: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Financials Revenue Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing 9 Creating Lasting Value - Investor Presentation
Slide 10: Strategy and Approach
Strategy and Approach Create sustainable revenue streams Seek cost leadership • Focus: Chronic therapies • Vertical integration : Development through • Differentiation: Manufacturing (API and Technically complex Finished Dosage) to products Marketing • Speed to market • Optimize operational costs Ba
Slide 11: Growing Steadily
Growing Steadily Consistent top-line and bottom-line growth; continuing the trend despite increasing size 15,000 20,000 50,000 4,000 1,000 5000 3,962 4,300 11,853 39,986 835 0 13,511 0 0 0 0 0 95-96 96-97 97-98 98-99 99-00 00-01 01-02 02-03 03-04 04-05 05-06 06-07 07-08 08-09 09-10 (Figures in Rs mi
Slide 12: Sustained Profitability
Sustained Profitability Superior business model Margins consistently higher than peers* Gross Margin EBITDA Margin Net Margin 90% 60% 50% 50% 40% 34% 80% 40% 30% 73% 31% 30% 20% 70% 20% 10% 10% 60% 0% 0% -10% 50% -10% -20% -20% 40% -30% -30% 05-06 06-07 07-08 08-09 09-10 05-06 06-07 07-08 08-09 09-1
Slide 13: Successful At Acquisitions
Successful At Acquisitions Acquired 14 high potential yet under-performing businesses*; successful turnarounds 10,000 45 8 Early 8,000 Acquisitions 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) 13 C
Slide 14: Key Acquisitions & Rationale
Key Acquisitions & Rationale Year Acquisition Country Rationale Dermatology & Topical Product Acquired Taro Pharmaceutical 2010 Israel Manufacturing Plant at Israel & Industries Ltd. Canada Caraco acquired some products 2009 US Increased generic product offerings of Forest’s Inwood business Import r
Slide 15: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Financials Revenue Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing 15 Creating Lasting Value - Investor Presentation
Slide 16: India Branded Generics: Strong Base
India Branded Generics : Strong Base • Market Share – Therapywise Break-up 3.7% Others Opthalmology- 4% Neuro-Psychiatry • Leadership in 8% 27% chronic segment; Antiasthamatic & Antiallergic- 5% Top 3 in over 50% of more than 500 Musculo-Skeletal & Pain- 5% brands Gynecology & Urology- 7% Gastroente
Slide 17: Relentless Customer Focus
Relentless Customer Focus Therapy focused Strong increase in marketing prescription and • 2,500+ sales representatives sales market share covering 130,000 specialist doctors 200 150 100 50 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Sun Cipla Ranbaxy Nicholas Cadila DRL 1998 Market Share
Slide 18: Therapy Focused Marketing
Therapy Focused Marketing Delivering promotional message to specialty customers. Gastroenterology, Cardiology, Diabetology Oncology Orthopedics Ophthalmology Psychiatry, Neurology Gynecology Rheumatology, Asthma, Interventional Fertility, Gynecology, Dermatology COPD Cardiology Urology 18 Creating L
Slide 19: Preferred Choice of Doctors
Preferred Choice of Doctors Leadership in key therapeutic Our Top 8 Brands areas* Specialist June '05 June‘10 Brand Therapy area Psychiatrists 1 1 Name Neurologists 1 1 Glucored Oral antidiabetic Group Cardiologists 3 1 Proton pump inhibitor/ Orthopaedic 3 1 Pantocid antiulcerant Ophthalmologists 2
Slide 20: US Generics
US Generics Integrated generic manufacturer with flexibility for manufacture Approvals onshore / offshore Therapy wise summary CNS, 34 CVS, 13 Caraco Pharmaceutical Pain, 11 Laboratories Ltd. Oncology, 11 The 76% owned US generics subsidiary, markets own and Sun Pharma ANDAs Metabolism, 7 Cough / Co
Slide 21: ANDA Pipeline: Significant ramp up
ANDA Pipeline : Significant ramp up Products Filed and Approved Status 400 363 As of Sep 10, ANDAs for 146 350 products await approval (including 17 tentative 300 approvals) 250 Sun Pharma 217 207 90 Products pending 200 177 (with 9 tentative 150 142 approval) 100 95 Caraco 84 69 29 Products pending
Slide 22: US Generics ANDA Approvals in last year
US Generics 15 ANDA Approvals in last 1 year • Ketorolac Tromethamine Opthalmic • Cetrizine HCl Syrup (RX) • Nicardipine HCl Injection • Ergocalciferol Capsule • Promethazine HCL with Codeine • Bupropion HCL ER Tablets Syrup • Alprazolam Tablets USP • Valproic Acid Soln • Memantine HCL Tablets • Lev
Slide 23: Caraco Update
Caraco Update • Though Company has made significant progress towards regaining FDA compliance • Caraco estimates that it will commence manufacturing of first two products by the end of Fiscal 2011 • A second set of two or three products is planned for manufacture during the third quarter of Fiscal 2
Slide 24: Europe Generic Markets
Europe Generic Markets Plan to enter key markets • Working on complex generic products, including injectables • Filings from Indian site Focus Countries Acquired an API and Finished Dosage manufacturing company in Hungary with controlled substance capacity 24 Creating Lasting Value - Investor Presen
Slide 25: International Branded Generic Markets
International Branded Generic Markets Replicating the speciality Less Regulated Markets template • Product basket width and • 40 countries technology based products as • 550 strong local sales force growth drivers promotes brands to doctors CIS Countries China Mexico Myanmar Brazil Sri Lanka Focus M
Slide 26: Speciality API
Speciality API High Margin Regulated Strong regulatory capability Markets • 200 DMF / CEP filed • Business largely with end users in • 120 approved regulated markets • Over 160 speciality APIs across 8 (Including Taro) plants 26 Creating Lasting Value - Investor Presentation
Slide 27: Strong Regulatory Capability
Strong Regulatory Capability International level quality processes and documentation 240 200 200 160 144 120 112 120 82 80 84 64 40 35 0 Sep-07 Dec-07 Mar-08 J un-08 Sep-08 Dec-08 Mar-09 J un-09 Sep-09 Dec-09 Mar-10 J un-10 Sep-10 DMF/CEP Filed DMF/CEP Approved 27 Creating Lasting Value - Investor P
Slide 28: 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) Bryan Jammu Tennessee Cranbury Sikkim Plant Israel Bangladesh Plant Iz
Slide 29: Finished Dosage Manufacturing
Finished Dosage Manufacturing 15 Manufacturing sites worldwide • India : 6, US : 3 • Over 750,000 sq. ft. area • Capacities available for a variety of finished dosage Tablets / Injectables / Sterile Capsules Vials Dry powder Semisolids Ampoules Eye drops Pre-filled Liquids Syringes MDI Suppository G
Slide 30: API Manufacturing
API Manufacturing 9 World class locations with all sites ISO 14001, ISO 9002 approved • India : 6, US : 1, Hungary : 1 Over 25 API • Reactor capacity 1200 KL with over processes scaled up 650,000 sq ft area annually Panoli & Ahmednagar Hungary & (both India) Tennessee (US) API • International regula
Slide 31: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Financials Revenue Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing 31 Creating Lasting Value - Investor Presentation
Slide 32: 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 about 700 scientists Mumbai Immediate term Balancing Medium term ANDA, DMF, Products for India the risk Drug delive
Slide 33: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Financials Revenue Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing 33 Creating Lasting Value - Investor Presentation
Slide 34: 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 Eminent Independent Directors Audit Committee Hasmukh Shah Keki Mistry Chairman Gujarat Gas Vice Chairman and
Slide 35: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Financials Revenue Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing 35 Creating Lasting Value - Investor Presentation
Slide 36: Shareholding Pattern
Shareholding Pattern as on Sept 30, 2010 • Rs 1,000 Invested in the 1994 IPO is Individuals and Others6% currently worth Bodies Corporate5% more than Rs. Financial Inst / Banks 4% 176,000 Mutual Funds3% • Earned dividend of Rs. 4,000 FIIs / Foreign Banks 19% Promoter and promoter group 63% 36 Creati
Slide 37: Financials
Financials Market Capitalisation USD 9.8 billion* Figures in USD million 2005-06 2006-07 2007-08 2008-09 2009-10 P&L Summary Net Sales 370 472 833 932 845 Gross Profit 260 344 654 745 613 EBITDA 111 148 385 407 264 Net Profit 129 173 369 396 285 R&D Spend 45 62 71 72 52 Fully Diluted EPS (Rs.) 0.6 0
Slide 38: Financial Ratios
Financial Ratios 2005-06 2006-07 2007-08 2008-09 2009-10 Growth (% ) Net Sales 38.1 30.5 57.1 27.3 (6.4) Gross Profit 33.3 35.7 69.0 29.6 (15.1) EBITDA 17.9 36.8 130.7 20.2 (33.1) Net Profit 44.7 36.8 89.6 22.2 (25.7) Margins (% ) Gross Margin 70.2 73.0 78.5 79.9 72.5 EBITDA Margin (%) 30.0 31.5 46.
Slide 39: Financials Q2 FY11
Financials Q2 FY11 Q2 FY11 Q2 FY10 CHANGE H1 FY10 H1 FY09 CHANGE FY010 Net Sales 305.0 246.7 23.6% 616.6 423.7 45.5% 887.9 Gross Profit 220.5 187.2 17.8% 457.4 308.8 48.1% 644.7 Gross Margin 72.3% 75.9% 74.2% 72.9% 72.6% EBITDA 104.0 93.1 11.7% 241.1 119.9 101.1% 280.9 EBITDA Margin 34.1% 37.7% 39.1
Slide 40: Update on Taro
Update on Taro • Supreme Court of Israel delivered a unanimous verdict in favor of Sun Pharma, upholding the lower court verdict • Sun Pharma reached a settlement with Levitt & Moros families • Bought their stake as per the option agreement at $7.75/share and a lump sum payment of $ 1.5 million • Co
Slide 41: 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 Uday Baldota Mira Desai Tel : +91 22 6645 5645, Ext Tel : +91 22 6645 5645, Ext 606 605 Tel Direct : +91 22 66455606 Tel Direct : +91 22 66455605 Mobile : +91 98219 23797 Mobile : +91 98670 10529 mira.desai@sunp
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