Sun Pharmaceuticals Industries (NSE:SUNPHARMA) Beneish M-Score : -2.06 (As of May. 06, 2024)

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What is Sun Pharmaceuticals Industries Beneish M-Score?

The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Good Sign:

Beneish M-Score -2.06 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Sun Pharmaceuticals Industries's Beneish M-Score or its related term are showing as below:

NSE:SUNPHARMA' s Beneish M-Score Range Over the Past 10 Years
Min: -2.78 Med: -2.57 Max: -1.28
Current: -2.06

During the past 13 years, the highest Beneish M-Score of Sun Pharmaceuticals Industries was -1.28. The lowest was -2.78. And the median was -2.57.

Sun Pharmaceuticals Industries Beneish M-Score Historical Data

The historical data trend for Sun Pharmaceuticals Industries's Beneish M-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Sun Pharmaceuticals Industries Beneish M-Score Chart

Sun Pharmaceuticals Industries Annual Data

Trend

Mar14

Mar15

Mar16

Mar17

Mar18

Mar19

Mar20

Mar21

Mar22

Mar23

Beneish M-Score

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-2.29

-2.61

-2.75

-2.78

-2.06

Sun Pharmaceuticals Industries Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Beneish M-Score	Get a 7-Day Free Trial															-	-2.06	-	-	-

Competitive Comparison of Sun Pharmaceuticals Industries's Beneish M-Score

For the Drug Manufacturers - Specialty & Generic subindustry, Sun Pharmaceuticals Industries's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Sun Pharmaceuticals Industries's Beneish M-Score Distribution in the Drug Manufacturers Industry

For the Drug Manufacturers industry and Healthcare sector, Sun Pharmaceuticals Industries's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Sun Pharmaceuticals Industries's Beneish M-Score falls into.

Sun Pharmaceuticals Industries Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Sun Pharmaceuticals Industries for today is based on a combination of the following eight different indices:

-4.84

0.92 * DSRI

0.528 * GMI

0.404 * AQI

0.892 * SGI

0.115 * DEPI

-4.84

0.92 * 0.9192

0.528 * 0.9694

0.404 * 1.0801

0.892 * 1.1263

0.115 * 0.8838

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0

4.679 * 0.043524

0.327 * 1.0008

-2.06

This Year (Mar23) TTM:

Last Year (Mar22) TTM:

Total Receivables was ₹114,798 Mil.
Revenue was ₹432,789 Mil.
Gross Profit was ₹326,167 Mil.
Total Current Assets was ₹398,833 Mil.
Total Assets was ₹807,436 Mil.
Property, Plant and Equipment(Net PPE) was ₹113,537 Mil.
Depreciation, Depletion and Amortization(DDA) was ₹25,294 Mil.
Selling, General, & Admin. Expense(SGA) was ₹0 Mil.
Total Current Liabilities was ₹199,064 Mil.
Long-Term Debt & Capital Lease Obligation was ₹5,637 Mil.
Net Income was ₹84,736 Mil.
Gross Profit was ₹0 Mil.
Cash Flow from Operations was ₹49,593 Mil.

Total Receivables was ₹110,884 Mil.
Revenue was ₹384,264 Mil.
Gross Profit was ₹280,749 Mil.
Total Current Assets was ₹350,150 Mil.
Total Assets was ₹697,999 Mil.
Property, Plant and Equipment(Net PPE) was ₹111,689 Mil.
Depreciation, Depletion and Amortization(DDA) was ₹21,437 Mil.
Selling, General, & Admin. Expense(SGA) was ₹54,686 Mil.
Total Current Liabilities was ₹172,006 Mil.
Long-Term Debt & Capital Lease Obligation was ₹4,817 Mil.

1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Total Receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI	=	(Receivables_t / Revenue_t)	/	(Receivables_t-1 / Revenue_t-1)
	=	(114798.3 / 432788.7)	/	(110884.2 / 384264.2)
	=	0.265253	/	0.288562
	=	0.9192

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI	=	GrossMargin_t-1	/	GrossMargin_t
	=	(GrossProfit_t-1 / Revenue_t-1)	/	(GrossProfit_t / Revenue_t)
	=	(280748.8 / 384264.2)	/	(326167.1 / 432788.7)
	=	0.730614	/	0.753641
	=	0.9694

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than Property, Plant and Equipment to Total Assets.

AQI	=	(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)	/	(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
	=	(1 - (398833.4 + 113537.3) / 807435.9)	/	(1 - (350149.8 + 111688.9) / 697998.7)
	=	0.365435	/	0.338339
	=	1.0801

4. SGI = Sales Growth Index

Ratio of Revenue in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI	=	Sales_t	/	Sales_t-1
	=	Revenue_t	/	Revenue_t-1
	=	432788.7	/	384264.2
	=	1.1263

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI	=	(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1))	/	(Depreciation_t / (Depreciaton_t + PPE_t))
	=	(21437.4 / (21437.4 + 111688.9))	/	(25294.3 / (25294.3 + 113537.3))
	=	0.161031	/	0.182194
	=	0.8838

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI	=	(SGA_t / Sales_t)	/	(SGA_t-1 /Sales_t-1)
	=	(0 / 432788.7)	/	(54685.6 / 384264.2)
	=	0	/	0.142313
	=	0

7. LVGI = Leverage Index

The ratio of total debt to Total Assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase in leverage

LVGI	=	((LTD_t + CurrentLiabilities_t) / TotalAssets_t)	/	((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
	=	((5637 + 199063.8) / 807435.9)	/	((4817.1 + 172005.5) / 697998.7)
	=	0.25352	/	0.253328
	=	1.0008

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA	=	(IncomefromContinuingOperations_t	-	CashFlowsfromOperations_t)	/	TotalAssets_t
	=	(NetIncome_t - NonOperatingIncome_t	-	CashFlowsfromOperations_t)	/	TotalAssets_t
	=	(84735.8 - 0	-	49593.3)	/	807435.9
	=	0.043524

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Sun Pharmaceuticals Industries has a M-score of -2.06 suggests that the company is unlikely to be a manipulator.

Sun Pharmaceuticals Industries Beneish M-Score Related Terms

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Sun Pharmaceuticals Industries (NSE:SUNPHARMA) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Drug Manufacturers » Sun Pharmaceuticals Industries Ltd (NSE:SUNPHARMA) » Definitions » Beneish M-Score

Traded in Other Exchanges

524715:India

Address

Western Express Highway, Sun House, Plot No. 201 B/1, Goregaon (East), Mumbai, MH, IND, 400 063

Website

https://www.sunpharma.com

Sun Pharmaceuticals Industries Ltd is India's largest generic pharmaceutical manufacturer and the fourth largest in the world. The company's largest markets are the U.S. and India to make up the majority of revenue. The remaining is spread across both emerging and developed markets. In addition to generics, the company also produces and distributes name-brand formulas to specific geographies. It maintains manufacturing and research and development facilities globally to serve its markets but is primarily based in India.

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