Sun Pharmaceutical Industries shares plunged nearly 6 per cent in late morning trade on Tuesday after the pharma company posted a weaker-than expected annual sales outlook as it grappled with increased competition in the United States as well as supply constraints.
At 11.27 am, stocks of the company were trading 5.58 per cent down at Rs 767.15. The scrip opened at Rs 798 and has touched a high and low of Rs 807.70 and Rs 765, respectively, in trade so far. Sensex was trading 83.74 points down at 26,641.86 during the same time.
The company said it expects sales to climb between 8 and 10 per cent this financial year, below an average analysts’ estimate of a 20 per cent rise.
Japanese brokerage house Nomura maintains ‘Neutral’ rating on Sun Pharma shares with target price of Rs 817.
Chief Executive Dilip Shanghvi also said on a conference call with analysts that profit would be hurt in the near term as Sun Pharma spends heavily on building up its specialty drugs business in the United States, its largest market.
The company reported a consolidated net profit of Rs 1,713.69 crore for the fourth quarter ended March 31, 2016. It had posted a net profit of Rs 889.24 crore for the same period of the previous quarter, Sun Pharmaceutical Industries said in a filing to the BSE.
Later, the scrip closed 6.13 per cent down at Rs 762.70.
With agency inputs