Sanofi India Ltd (SANOFI) Concall Report Analysis & Insights

Sanofi India Ltd

| Investor Conference Call – Feb 26, 2026

NEUTRAL SENTIMENT

⬤5th Mar 26

Summary : Sanofi India is undergoing a business transformation, focusing on diabetes leadership and strategic partnerships, with strong Q4 insulin growth despite partnership sales volatility and an 8-quarter low in EBITDA margins.

Management Perspective positive : Management consistently emphasized the 'transformation' and 'modernization' of the business, expressing confidence in achieving 'sustainable and profitable growth' and 'double-digit growth' in key segments despite current fluctuations. They highlighted achievements like 1% PBT growth and 11% Q4 insulin growth, framing challenges as temporary or anticipated.

Concall Report Analysis & Insights

Business Overview

Sanofi India Limited underwent significant business transformation in 2025, modernizing operations.
The company is an R&D-driven, AI-enabled biopharma organization focused on patient-centricity.
Key portfolios include diabetes (insulin, OADs), cardiovascular (CV), and central nervous system (CNS) agents.
Domestic sales were flat in 2025, but profit before tax grew 1% due to efficiency and diabetes momentum.
Sanofi maintains leadership in the insulin segment, with Lantus holding 31% market share.

Future Growth Prospects

Accelerating double-digit growth for Soliqua in both private and public sectors.
Expanding Toujeo, an innovator U-300 glargine, into the public sector.
Fueling the pipeline with Phase II/III studies for teplizumab, Brivekimig, and Frexalimab.
Introducing a novel pen with digital solutions for improved diabetes adherence.
Partnerships are expected to stabilize and deliver better returns in 2026, targeting Tier 2/3 cities.

Management Insights

The year 2025 was pivotal for transformation, fundamentally modernizing the business model.
Focus is on sustainable, profitable growth through patient-centric, digitally-enabled capabilities.
Proud of CSR initiatives, including diabetes awareness in schools and mobile medical units.
Confident in capturing India's high-growth diabetes opportunity with future-ready capabilities.
Operational efficiency and stabilizing partnerships are key path forwards for growth.

Signs of Skepticism

Analyst questioned the significant volatility and drop in partnership sales.
Management did not provide a clear base number for partnership sales for 2026.
EBITDA margins hit an 8-quarter low, raising concerns about profitability.
Analyst inquired if Sanofi India might follow Novartis's exit path, which management denied.
Management's explanation for partnership sales fluctuations was primarily inventory-related.

Risk Factors

Partnership sales experienced volatility and a 2% decline year-on-year due to stock movements.
Competitive discounting in institutional business poses a headwind for certain portfolios.
The transformation process is taking time to fully reflect in financial performance.
EBITDA margins were at an 8-quarter low, impacted by phasing and top-line movements.
Fluctuations in partnership stock replenishment are expected to continue through 2026.

Good To Know

Proposed dividend increase of 5% over 2024, with an EPS of INR 142 and DPS of INR 123.
Significant CSR initiatives include Sakhar Free Shukrawar, Mobile Medical Units, and flood aid.
LANDMARC real-world evidence study concluded with 6,000 patients over 3 years.
Recruitment of 105 patients for Soliqua safety and efficacy study in Type 2 diabetes completed.
Goa manufacturing facility exports essential medicines to 25 countries worldwide.

Key Drivers

Diabetes franchise shows strong momentum.
Soliqua and Toujeo drive double-digit growth.
Partnerships expected to stabilize and grow.
Public sector expansion for key products.

Key Analyst Discussions

Competitive Environment

Analyst noted aggressive discounting from competition impacting CV portfolio sales.
Management acknowledged GLP-1 market growth and Soliqua's role in that acceleration.
Analyst asked about potential benefits from Novo Nordisk discontinuing human insulin pens.
Management confirmed analog insulins benefited from the shift from human insulin.
Analyst inquired about Sanofi's strategy to tackle competitive discounting.

Market Trends & Consumer Behavior

Management highlighted India's growing non-communicable disease population through 2035.
Improved awareness in Tier 2/3 cities is helping early diagnosis and treatment.
Soliqua offers weight neutrality and low hypoglycemia, unique features for diabetes management.
GLP-1 drugs are influencing the insulin market, creating new opportunities for combinations.
Market is moving towards innovation, benefiting products like Toujeo and Soliqua.

Financial Highlights

Analyst questioned the 13% year-on-year drop in partnership sales and Q4 volatility.
Management attributed partnership sales drop to stock stabilization and gross-to-net adjustments.
Analyst asked about the 8-quarter low EBITDA margins and their impact on segments.
Management stated full-year profit before tax was up 1%, and after tax up 4%.
Partnership growth, excluding one-offs, was estimated at 4-5% volume growth plus WPI.

Product Composition

Analyst asked about scaling the diabetes business beyond Soliqua and parent portfolio.
Management plans to maximize current portfolio, including Soliqua and Toujeo, before new products.
Soliqua targets premix, basal-failing, and OAD-failing patient segments.
Analyst inquired about bringing Soliqua into a reusable pen version.
Management confirmed plans to introduce a reusable pen for Soliqua in upcoming years.

Strategic Considerations

Analyst questioned Sanofi India's future play in broader therapy areas beyond current focus.
Management stated current strategy focuses on diabetes, CV, and CNS for synergy.
No confirmed plans to launch new therapeutic areas in the listed company for 2026.
Analyst asked about the long-term expectations for partnership business over 3-5 years.
Management expects growth from partnerships, leveraging partners' wider footprint.