Tuesday, August 14, 2012

Sun’s Wonder Drug!

Despite litigations, Sun Pharmaceuticals has managed to give its investors the largest m-cap growth by steven philip warner
 
This is bad news for those sceptical about investments in pharmaceutical stocks, and a bigger disappointment for those doubting the potential of profits contributing to shareholder value. Sun Pharmaceuticals, after becoming the highest profit-making pharmaceutical company in FY 2008-09 (with net profits of Rs.38.76 billion), became the largest wealth creator in the sector in FY2009-10: its m-cap increasing by 41.4% to touch Rs.373.01 billion (as on March 31, 2010).

Uday Baldota, VP – Investor Relations, Sun Pharma talked to B&E, “Customers, employees and society are at the core of our existence. Having extremely satisfied customers, being served by high performing employees meeting the unmet and evolving needs of the society have been key to delivering superior returns to our shareholders...” Notwithstanding that, there have been some negative reactions to the company stock, considering that just a few days back, it lost the right to market one of its top-selling drug, Pantoprazole in US (which as per a New Jersery district court was infringing Wyeth’s patent rights).

Sun has even battled out many such litigations in US in the past one year. All this should have wreaked havoc on the Indian pharmaco in the US market (which contributed to 35.4% of its annual revenues in FY2008-09)... It didn’t! Rather, Sun’s stock has for many years now, outperformed both the Sensex and the Nifty.


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