Buy Sun Pharma; target of Rs 1635: Motilal Oswal

Motilal Oswal is bullish on Sun Pharma recommended buy rating on the stock with a target price of Rs 1635 in its research report dated January 31, 2024.

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February 07, 2024 / 19:04 IST

Buy

26 Aug, 2025 12:21

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Motilal Oswal's research report on Sun Pharma

Sun Pharma (SUNP) delivered in-line earnings for 3QFY24. SUNP delivered robust performance in domestic formulation (DF), specialty portfolio, US generics as well as the ROW market. This was partially offset by subdued show in emerging markets for the quarter. The R&D expenditure remained lower than earlier guidance, partly driving better profitability for the quarter. We raise our earnings estimates for FY25/FY26 by 4%/5%, factoring a) superior execution in global specialty sales, b) revival in growth prospects in Taro, and c) industry-beating growth in the branded generics DF market. We also raise our PE multiple to 28x (from 26x earlier), factoring a) increased contribution from specialty and branded generics portfolio, b) expanding specialty portfolio by adding new molecules as well as utilizing existing molecule for alternate indications, and c) robust ANDA pipeline, comprising niche products. Accordingly, we arrive at a price target of INR1,635.

Outlook

We also raise our PE multiple to 28x (from 26x earlier) factoring a) increased contribution from specialty and branded generics portfolio, b) expanding specialty portfolio by adding new molecules as well as utilizing existing molecule for alternate indications and c) robust ANDA pipeline comprising niche products. Accordingly, we arrive at a price target of INR1,635.

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