Shares of Sun Pharma rose today after falling for five consecutive sessions as the healthcare firm said the company would not revise its revenue guidance downwards for the current financial year due to USFDA’s import alert at its Halol facility. Sun Pharma also said there would be no impact on sales of Sun Pharma’s specialty portfolio after the US Food and Drug Administration (FDA) imposed import alert.
Buoyed by the company’s statement, Sun Pharma stock rose up to 1.46% to Rs 995.30 against the previous close of Rs 980.95 on BSE. The share opened flat at Rs 980.80 on BSE.
Shares of Sun Pharma are trading higher than the 100 day and 200 day moving averages but lower than 5 day, 20 day and 50 day moving averages. Sun Pharma stock has gained 30.39 per cent in a year and risen 17.13 percent in 2022.
A total of 0.40 lakh shares of the firm changed hands amounting to a turnover of Rs 3.90 crore on BSE. The market cap of the firm rose to Rs 2.38 lakh crore.
In the previous session, the Sun Pharma stock had fallen 2.5% on the news of import alert.
Japanese brokerage Nomura has assigned a buy call to Sun Pharma for a target of Rs 1094. Halol import alert is a negative surprise as it will lead to loss of sales, besides delaying new product approvals, said, Nomura. Overall sales from site to US was $150mn in FY22, at 3% of consolidated revenue, Nomura said adding that its expects 4-7% impact on FY24F EPS.
Also Read: USFDA lists Sun Pharma’s Halol unit under ‘import alert’, stock falls 2.5%
Morgan Stanley is overweight on Sun Pharma with a target price of Rs 1150.
Escalation of regulatory action at Halol is a setback, said Morgan Stanley adding that net sales impact on the firm’s ongoing business should be 1%. Future approvals will get blocked from this site. Yet Morgan Stanly expects marginal impact on overall growth story since balance sheet is strong and the company is net cash positive.
The import alert means all future shipments of products made at Halol can be refused admission to the US market until the facility becomes compliant with the FDA’s Current Good Manufacturing Practice standards, the company said in a stock exchange filing.
For the year ended March 31, 2022, supplies to the US market from the Halol facility accounted for approximately 3% of the company’s consolidated revenues, including the 14 excluded products.
