Even as Indian share market traded with nearly 1.5 per cent cuts on Friday, taking cues from the global markets, Sun Pharma was among top four BSE Sensex gainers today. Sun Pharma stock gained 1 per cent to hit day’s high of Rs 479 apiece on BSE today. Sun Pharmaceuticals Industries stock has been on a gaining spree since it touched a 52-week low of Rs 315.20 in March this year. It rallied over 62 per cent from its March low and hit a 52-week high of 512.55 earlier this week. Research and brokerage firms are upbeat on the stock and recommend it to buy with an upside of over 30 per cent at a price target of Rs 620. “Company maintains its leadership position in the domestic market and support from ROW markets is healthy. The US market has been steady and improving base riding on speciality,” Centrum Broking said in a report.
The brokerage firm has maintained its buying rating to the stock. Sun Pharma stock will have to jump 31 per cent from its Thursday’s close, to reach the target price of Rs 620 pegged by the Centrum Broking. “We anticipate the speciality basket focus strategy to start paying dividends from FY21E onwards which would add significant delta to earnings going ahead,” it added.
Five Indian firms including Sun Pharmaceuticals, are among the 26 drug makers facing a multi-state lawsuit filed in the US for alleged conspiracy to artificially inflate and manipulate prices, reducing competition for generic drugs sold across the United States. “Previous instances of price-fixing show that fines get significantly discounted, based on a company’s level of cooperation and can range from full immunity for first-to cooperate and significant discounts for second-in,” DART said in its latest report. The brokerage sees 12 per cent upside in the stock with a target price of Rs 530.
However, global research firm Credit Suisse is neutral on the stock with up to 20 per cent downside at a target of Rs 400. “Our neutral rating for Sun Pharma is driven by the slow ramp-up of speciality drugs and weaker-than-expected pace of approvals in the US generic business, which will be further impacted by Halol facility’s OAI classification,” it said in its recent report.