Sun Pharmaceutical Industries Limited

SUNPHARMA.BO•drug-manufacturers-specialty-generic

Current Price

1,595.10INR

per share

Fair Value

937.03INR

Overvalued

70.2%

Valuation Overview

Growth Story

Over the next few years, revenue is expected to grow by 10.99%, lower than industry average of 12.71%.

Growth Trajectory

Profitability

In the growth phase company makes 26.35% profit on every dollar of sales, higher than industry average of 20.42%.

Profitability Trajectory

Risk Profile

Investors expect at least 7.70% return to justify the risk of holding stock.

Risk vs Return

Required Return (Cost of Capital) (%)

Return on Invested Capital (%)

Financial Health Overview

Enterprise Value

2.04T INR

Equity Value

2.24T INR

FCF Yield

36.98%

Average ROIC

25.15%

Cost of Capital

8.12%

P/E Ratio

28.79x

Financial Metric	Most Recent 12 months (INR)	Previous Year (INR)
Revenues	533.03B INR	477.58B INR
Operating Income or EBIT	152.77B INR	118.29B INR
Interest Expense	2.45B INR	2.38B INR
Book Value Of Equity	722.18B INR	636.67B INR
Book Value Of Debt	23.62B INR	32.74B INR
Cash and Marketable Securities	263.18B INR	193.29B INR
Number of Shares Outstanding	2.40B	--
Minority interests	34.59B INR	0 INR
Current Stock Price	1595.10 INR	--
Effective Tax Rate	13.00%	--
Marginal Tax Rate	30.00%	--

Performance vs Industry

Revenue Growth

-1.10%

11.60%Company

12.71%Industry

At Industry Level

Operating Margin

+8.24%

28.66%Company

20.41%Industry

Above Industry

Sun Pharmaceutical Industries Limited demonstrates superior operational efficiency with margins above industry average, indicating effective cost management.

Terminal Value Analysis

Growth Rate

4.65%

Cost of Capital

8.88%

Return on Capital

8.88%

Reinvestment Rate

52.36%

Terminal value represents 58% of total enterprise value, based on 4.65% perpetual growth and 8.88% discount rate.

Equity Value Breakdown

Component	Value	Type
Present Value (Terminal Value)	1.18T INR	Add
Present Value (Cash Flow Over Next 10 Years)	853.50B INR	Add
Value of Operating Assets	2.04T INR	Sub-total
Debt	23.62B INR	Subtract
Minority Interests	34.59B INR	Subtract
Cash	263.17B INR	Add
Value of Equity	2.24T INR	Sub-total
Number of Shares	2.40B shares	Divisor
Estimated Value per Share (Fair Value)	937.03 INR	Total
Current Market Price	1.59K INR	Reference

Financial Projections

Total FCF Present Value

853.50B INR

Avg Revenue Growth

7.90%

Avg Operating Margin

25.83%

Avg ROIC

25.15%

Year	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal Year
REVENUE
Revenue	587.77B INR	652.35B INR	724.04B INR	803.61B INR	891.91B INR	978.62B INR	1.06T INR	1.13T INR	1.20T INR	1.26T INR	1.31T INR
Growth Rate	10.27%	10.98%	10.98%	10.98%	10.98%	9.72%	8.45%	7.18%	5.91%	4.65%	4.65%
PROFITABILITY
Operating Income	168.46B INR	176.93B INR	190.80B INR	205.58B INR	221.31B INR	242.83B INR	263.35B INR	282.28B INR	298.98B INR	312.88B INR	327.43B INR
Operating Margin	28.66%	27.12%	26.35%	25.58%	24.81%	24.81%	24.81%	24.81%	24.81%	24.81%	24.81%
EBIT (1-tax)	146.56B INR	153.93B INR	166.00B INR	178.86B INR	192.54B INR	203.00B INR	211.21B INR	216.79B INR	219.45B INR	219.02B INR	229.20B INR
CASH FLOW
Reinvestment	43.81B INR	48.62B INR	53.97B INR	59.90B INR	58.81B INR	81.51B INR	75.14B INR	66.33B INR	55.20B INR	57.77B INR	120.02B INR
Free Cash Flow	102.75B INR	105.30B INR	112.03B INR	118.96B INR	133.73B INR	121.49B INR	136.06B INR	150.45B INR	164.24B INR	161.24B INR	109.18B INR
Terminal Value	--	--	--	--	--	--	--	--	--	--	2.58T INR
Present Value	95.40B INR	90.78B INR	89.68B INR	88.42B INR	92.29B INR	77.68B INR	80.42B INR	82.03B INR	82.43B INR	74.32B INR	—
EFFICIENCY
ROIC	30.36%	29.24%	28.86%	28.43%	27.94%	27.14%	25.46%	23.97%	22.60%	21.34%	8.88%
Cost of Capital	7.69%	7.69%	7.69%	7.69%	7.69%	7.93%	8.17%	8.40%	8.64%	8.88%	8.88%
Sales/Capital	1.47x	1.47x	1.47x	1.47x	1.47x	1.01x	1.01x	1.01x	1.01x	1.01x	—

Profitability & Efficiency

Operating Margin (%)

ROIC (%)

Value Creation Analysis

ROIC (%)

Cost of Capital (%)

Operational Cash Flow Analysis

Free Cash Flow (₹B)

Reinvestment (₹B)