Reduce Sun Pharma, target Rs 450: IIFL

IIFL has a reduce call on Sun Pharmaceutical Industries Ltd. with a target price of Rs 450. The current market price of Sun Pharmaceutical Industries Ltd. is Rs 555.25 Time period given by the brokerage is a year when Sun Pharmaceutical Industries Ltd. price can reach defined target.

Sun Pharmaceutical Industries Ltd., incorporated in 1993, is a largecap company with a market cap of Rs 129683.49 crore.

Investment rationale by IIFL


Halol’s latest Feb-18 inspection as VAI (voluntary action indicated). Although management has not provided any clarity on this, we believe the VAI status implies that the Warning Letter on the Halol facility will most likely be lifted by the USFDA within a few weeks. While this will be substantially positive for Sun Pharma, the post-Halol clearance-earnings recovery is already built in our estimates. We maintain our REDUCE rating, as we believe that Sun’s speciality business will achieve critical mass not before 2-3 years, by when the company would start seeing impact of competitive pressures in Absorica and Levulan.