Highly diversified revenue base
While international sales contribute to about 67% of its revenue (geography-wise), product-wise, the company is well diversified. These include medications for chronic diseases including cardiovascular, diabetes and respiratory-related illnesses. Further, the company also has therapeutic products for treatments like oncology. While specialty products are one of the key differentiators for Sun Pharma, its contribution to revenue is around 11% (FY21). Thus, the diversified revenue base helps the company to reduce the risk of dependency on one specific product.
India’s pharma industry has multiple growth enablers. This along with Sun Pharma’s market position is likely to benefit the company going ahead. These factors include rapid urbanisation and rising income levels, an increase in public healthcare spending, and lifestyle and food consumption changes causing a rise in the incidence of chronic ailments. An increase in access to innovative treatments is also a positive.
For instance, the company has multiple products on the market already to treat chronic ailments like diabetes. About 8% of revenue is from diabetology products in the industry as a whole.
Additionally, the diverse operations across countries also reduce the dependencies on one country for the company. Though the US is still a major contributor to revenue, the pharma industry in the US is likely to have consistent demand. According to many experts, developed countries spend more on the healthcare needs of their people.
Improving specialty products
Specialty medicines are the latest generation products and are one of the important products of Sun Pharma. These products are primarily targeted at treating chronic, and rare diseases like auto-immune
Click here