Buy Sun Pharma, target price Rs 560: Emkay Global

Emkay Global has given a buy rating to Sun Pharma with a target price of Rs 560. The share price moved up by 5.35 per cent from its previous close of Rs 485.10. The stock’s last traded price is Rs 511.05.

Sun Pharmaceutical Industries Ltd., incorporated in the year 1993, is a Large Cap company (having a market cap of Rs 120122.71 Crore) operating in Pharmaceuticals sector.

Financials
For the quarter ended 30-09-2020, the company reported a Consolidated sales of Rs 8458.77 Crore, up 13.28 % from last quarter Sales of Rs 7467.19 Crore and up 6.41 % from last year same quarter Sales of Rs 7949.19 Crore
Company reported net profit after tax of Rs 1948.38 Crore in latest quarter.

Investment Rationale
The brokerage assumes coverage on SUN Pharma with a Buy rating at a TP of Rs 560. The TP represents a P/E multiple of ~20x on our FY23E EPS. Catalysts: Specialty sales growth, Halol plant resolution and recovery in the branded markets. Downside risks: Lower than-expected uptick in Specialty, adverse regulatory outcome, significant slowdown in branded markets.

Promoter/FII Holdings
Promoters held 54.7 per cent stake in the company as of Sept 30, 2020, while FIIs held 12.4 per cent, DIIs 20.5 per cent and public and others 12.5 per cent.