Buy Sun Pharmaceutical, target of Rs 1600: IIFL

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IIFL has recommended a buy rating on Sun Pharmaceutical Industries with 12-month target price of Rs 1600 in its September 2, 2008 research report. "Taro's focussed therapeutic portfolio and branded-generic experience in the US and European operations make it an ideal acquisition target for Sun. Apart from near-term value from operational improvement and manufacturing synergies, it can impart long-term growth momentum to Sun. Sun has already acquired 36.4% at an average price of about USD 8 per share and an Israeli court's recent order puts it on course to acquire an additional 12.2% from Taro's promoters. The remaining 51.4% with non-promoters may not come cheap. But at Taro's current estimated profitability, our analysis shows that Sun has leeway to pay up to USD 24 per share without diluting its EPS. Buy 12-month target of Rs 1600," says IIFL's research report.

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