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Sanofi India 4QCY2013 performance highlights and results update

February 27, 2014, Thursday, 06:05 GMT | 01:05 EST | 11:35 IST | 14:05 SGT
Contributed by Angel Broking


Sanofi India (Sanofi) posted a good set of numbers for 4QCY2013. Total sales came in at Rs.461cr V/s Rs.440cr expected posting a yoy growth of 15.1%. The main surprise came in at operating front, which came in at 18.8% (12.5% expected) an expansion of 615bps yoy, mainly on back of the low rise in the employee and other expenses. This aided the net profit front, to come in at Rs.67.3cr V/s Rs.46cr expected, posting a yoy growth of 50.2%. We remain neutral on the stock.

Better-than-expected results: Sanofi posted a 15.1% yoy growth in sales to Rs.461cr, vs an expected Rs.440cr, mainly driven by exports. The OPM came in at 18.8%, an expansion of 615bp (vs 12.7% in 4QCY2013), mainly on back of the low rise in the employee and other expenses, which rose by 2.6% and 4.0% yoy respectively. Also a 241bps yoy expansion in the GPM, also aided the OPM expansion. This aided the net profit front, to come in at Rs.67.3cr V/s Rs.46cr expected, posting a yoy growth of 50.2%.

Outlook and valuation: We expect net sales to post a 12.8% CAGR to Rs.2,171cr and EPS to register a 7.7% CAGR to Rs.124.9 over CY2013–15. At current levels, the stock is trading at 23.4x and 21.1x CY2014E and CY2015E earnings, respectively. We remain Neutral on the stock.

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