Motilal Oswal's research report on Sun Pharma
Sun Pharmaceutical Industries’ (SUNP) 1QFY26 revenue and EBITDA were 3%/9% better than our estimates. However, Adj. PAT was lower than expected (6% miss) due to lower other income and a higher tax rate. SUNP has exhibited eight consecutive quarters of healthy double-digit YoY revenue growth in the domestic formulation (DF) segment, led by new launches, market share gains, and increased reach. In addition to steady traction in the Global specialty (renamed as global innovative medicines) portfolio, SUNP continues to expand its portfolio through the launch of Leqselvi, thereby driving its dermatology offerings.
Outlook
We reduced our earnings estimates by 5%/4% for FY26/FY27, factoring in: a) higher opex for branded business and b) higher tax rate. We value SUNP at 32x 12M forward earnings to arrive at a TP of INR1,960.
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