sun pharma shares: Sun Pharma shares tumble 5% but brokerages raise target up to Rs 1,785. Should you buy, sell or hold?

Shares of Sun Pharmaceutical Industries fell 5% in Thursday’s trade on BSE to the day’s low of Rs 1,467 even after the company posted a 34% year-on-year (YoY) jump in its Q4 profit to Rs 2,654.6 crore while the revenue rose 10.1% YoY to Rs. 11813 crore in Q4FY24.

The board of the company also declared an interim dividend of Rs. 5 per equity share for FY24 in addition to the interim dividend of Rs 8.5 already paid during the year.

Despite a fall in the share price today, brokerages are positive on the stock, and most of them have increased the target prices. Here’s what brokerages have to say:

Jefferies

Jefferies expects growth for Sun Pharma to pick up from FY26 backed by which, it has a ‘buy’ view on the stock with a target price of Rs 1,785

Citi Bank

The global brokerage firm stated that the company has margin levers but sees a possibility that FY25 margins may remain subdued. Citi has a ‘buy’ rating on the stock with a target price of Rs 1,640 as it believes that the underlying business trends as well as medium term/LT margin expansion story remains intact.

Also read: Q4 results today: ITC, IndiGo among 181 companies to announce earnings on Thursday

JP Morgan

JP Morgan said Sun Pharma presented a strong show in specialty drives in the US while its key business continued to strengthen and the company entered its investment phase.

JP Morgan has an ‘overweight’ rating on the stock with a target price of Rs 1,610.

Prabhudas Lilladher

FY25 expenses may remain elevated given the company is in the investment phase to ramp up the specialty pipeline; the launch of deuruxolitinib along with the progress of other pipelines provides visibility to SUNP’s specialty pipeline beyond FY25.

Stating that Sun Pharma remains Prabhudas’ top pick in the sector, it maintained a ‘buy’ call on the stock with a revised target price of Rs 1,710.

Motilal Oswal

Sun Pharma reported a slight miss at the operational level for 4QFY24 due to lower-than-expected sales in the ROW market and higher-than-expected opex for the quarter.

“SUNP continues to work on enhancing its specialty pipeline in the areas of dermatology, ophthalmology, and onco-dermatology. In fact, the target action date of Jul’24 is the key near-term trigger with respect to Deuruxolitinib”, said Motilal Oswal in a report.

Motilal Oswal retained its ‘buy’ rating on the stock with a target of Rs 1,810.

Nuvama

Overall, earnings were a miss on operating level as per Nuvama and following the company’s guidance of high single-digit revenue growth and 8–10% R&D spend, the brokerage firm cut its FY25E/26E EPS by 17%/6%.

Nuvama has downgraded the stock to ‘hold’ with a target price of Rs 1,620.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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