Shares declined nearly 2.5% in Monday's trading before recouping most of its losses. The stock eventually closed at ₹968.50, down 0.14% from the previous close. More than 5.6 million shares exchanged hands on the BSE and NSE on Monday, over twice its combined average daily volume for the last month.
The fourth quarter earnings also indicated the speciality business was nearing a break-even point.
Mumbai: Analysts remained hopeful of Sun Pharma's long-term growth prospects, advising clients to buy the stock but lowered price targets after the pharma major's fourth-quarter revenue beat analysts' expectations but missed estimates at an operating level.
Shares declined nearly 2.5% in Monday's trading before recouping most of its losses. The stock eventually closed at ₹968.50, down 0.14% from the previous close. More than 5.6 million shares exchanged hands on the BSE and NSE on Monday, over twice its combined average daily volume for the last month.
"FY24 could see earnings pressure owing to the Halol import alert impact, increased R&D, concert consolidation and a gradual uptick at Mohali," said Nuvama in a note to clients. "gRevlimid could provide margin respite and several other factors shall begin to reverse in FY25. Sun Pharma's expanding speciality bouquet and steady India growth provide comfort for the long term."
The fourth quarter earnings also indicated the speciality business was nearing a break-even point.
"We believe robust speciality performance, gRevlimid launch and strong domestic/EM/ROW performance will sustain double-digit growth in FY24 accompanied by higher R&D costs (7-8% of sales)," said JM Financial.
The domestic brokerage remains optimistic about the speciality outlook and is closely watching the Deuruxolitinib filing - a dermatology drug, and Ilumya PsA trials update as it prices in higher profitability support from the speciality segment.
Twenty-five out of 29 analysts who reviewed Sun Pharma's fourth-quarter earnings retained their 'buy' or 'outperform' rating. Three of them remained 'neutral' and one recommended a 'sell' rating. However, the consensus price target on the stock fell 2.6% to ₹1,140.82 per share, showed a Bloomberg poll of analysts.
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