Synopsis: Pharma Giant is rated Buy with a target of Rs 2,200, offering 22.5 percent upside, driven by high-margin specialty drugs, a strong domestic market, and the upcoming Semaglutide launch.
The article outlines UBS’s Buy rating on this pharma giant, citing 22 percent upside supported by high-margin specialty drugs, a strong domestic presence, and the upcoming Semaglutide launch. It highlights the company’s specialty portfolio, growth drivers, financial performance, and long-term profitability potential in global markets.
With a market capitalization of Rs 4,30,826 crore, Sun Pharmaceutical Industries Ltd’s shares are trading at Rs 1,795.65 per share, up by 0.80 percent from its previous close. The company trades at a bit overvalued P/E of 35.6x compared to its Industry average, and has given a return of 206 percent in the last 5 years.
Brokerage View
Sun Pharma is rated Buy with a target of Rs 2,200, offering 22.5 percent upside, driven by high-margin specialty drugs, strong domestic presence, the upcoming Semaglutide launch, and significant growth potential.
Rationale for Sun Pharma Buy Rating
Speciality products driving growth: Sun Pharma’s growth is being driven by its portfolio of high-margin specialty drugs, including Ilumya, Leqselvi, and Unloxcyt, which are contributing increasingly to overall sales and enhancing profitability compared with standard formulations, Leqselvi, and Unloxcyt.
Strong position in India: The company holds a strong position in the Indian market, providing stable and consistent domestic revenue. Its market share ensures resilience amid competition and supports predictable cash flows.
Upcoming product launch: Future earnings are expected to get a boost from the upcoming launch of Semaglutide for weight loss and diabetes management. Analysts see substantial upside potential relative to peers, justifying the Buy rating for the stock.
Sun Pharma’s specialty business focuses on high-margin, targeted therapies, making it the third fastest-growing in its segment. It includes innovative medicines across key therapeutic areas, driving strong revenue growth, global recognition, and a differentiated portfolio that enhances long-term profitability and market leadership.
About the Company
Sun Pharmaceutical Industries Ltd is engaged in the business of manufacturing, developing, and marketing a wide range of branded and generic formulations and Active Pharma Ingredients (APIs). The company and its subsidiaries have various manufacturing facilities spread across the world, with trading and other incidental and related activities extending to global market.
Financial Highlights: The revenue from operations grew by 13 percent to Rs 15,521 crore in Q3 FY26 from Rs 13,675 crore in Q3 FY25. EBIDT grew by 23 percent to Rs 4,948 crore in Q3 FY26 from Rs 4,009 crore in Q3 FY25. This was accompanied by a 19 percent net profit growth to Rs 3,381 crore in Q3 FY26, from Rs 2,193 crore in Q3 FY25, resulting in an EPS growth of 16 percent to Rs 14.04 per share in Q3 FY26.
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