Sun Pharma expects its India business to stabilise in the current fiscal leading to “reasonable volume growth” after witnessing disruptions in 2017-18 due to GST implementation, a top company official said.
In a message to shareholders in the company’s Annual Report for 2017-18, Sun Pharma Managing Director Dilip Shanghvi however said the government’s enforced price cuts and policy changes are potential risk factors for the business.
“We expect normalisation of the India business in 2018-19 post the disruption in 2017-18 due to GST implementation. Favourable demographics will ensure reasonable volume growth in India,” Shanghvi said.
However, government-mandated price reductions/policy changes continue to be potential risks for this business, he added.
The company’s India business revenues stood at Rs 8,029 crore in 2017-18, a growth of 4 per cent over 2016-17.
Shanghvi said the short-term outlook for the US generics market continues to be challenging given the pricing pressures.
“We are also expecting reasonable growth in our emerging markets business, however, as always, currency fluctuations continue to be a risk,” he added.
The Mumbai-based drug firm posted consolidated revenues of Rs 26,489.46 crore for 2017-18.
Shanghvi said the company’s consolidated R&D investments for 2018-19 will be about 8-9 per cent of its revenues.