Sun Pharma Shares Slip 5% After Q1 Profit Drops 20%; Should You Buy, Hold or Sell? Check Brokerages' Ratings

Sun Pharmaceutical Industries Ltd experienced a notable decline in its share price, dropping by 4.6% during intraday trading on the Bombay Stock Exchange (BSE), reaching a low of Rs 1,626.50. This fall followed the company's announcement of its Q1FY26 earnings, which showed a 20% year-on-year (YoY) decrease in consolidated net profit.

Sun Pharma Q1 Results 2026: Net Profit 20% Decline

The profit stood at Rs 2,278 crore, down from Rs 2,836 crore in the same quarter of the previous year. Despite the profit decline, the company posted a 10% YoY increase in revenue from operations, which rose to Rs 13,786 crore compared to Rs 12,525 crore in Q1FY25. This reflects a steady performance in its core business, though earnings were affected by increased costs.

Sun Pharma Share Price Today

NSE: SUNPHARMA; Sun Pharma stock is currently trading at Rs 1,624.10, reflecting a sharp decline of Rs 82.60 from the previous close. The stock opened the trading session at Rs 1,690.00 and reached an intraday high of Rs 1,695.00. However, it also saw a steep drop, hitting a low of Rs 1,608.00 during the day's trade.

Should You Buy, Hold or Sell Sun Pharma Stock? Check Top Brokerage's ratings

Several brokerages responded to the Sun Pharma earnings report with updated views on the company's stock. Nuvama Institutional Equities maintained a 'Hold' rating on the stock with a target price of Rs 1,830. It acknowledged the margin outperformance, crediting it to an improved product mix and strong growth in the Rest of World (ROW) markets.

Nuvama also pointed out that FY26 is likely to be a year of significant investment for Sun Pharma, driven by increased promotional spending on new products like Leqselvi and Unlocxyt, as well as the initiation of Phase II clinical trials for the pipeline drug GLO034.

Avendus Capital upgraded its rating on Sun Pharma from 'Reduce' to 'Add' and raised its target price to Rs 1,830 from Rs 1,770. While the brokerage expects higher costs related to new product launches to weigh on margins in FY26, it remains optimistic about long-term growth.

Avendus anticipates meaningful gains beginning in FY27 and projects a 14% compound annual growth rate (CAGR) in the India business between FY25 and FY27. EBITDA margins, which may fall to 28% in FY26, are expected to rebound to 31% in FY27 as the company benefits from its investments.

Motilal Oswal Financial Services also weighed in, maintaining its 'Buy' rating but reducing the target price slightly from Rs 2,000 to Rs 1,960. The firm cited continued support for earnings from Sun Pharma's innovative and branded portfolio.

While higher operating expenses and tax rates led Motilal Oswal to revise its FY26 and FY27 earnings estimates downward by 5% and 4%, respectively, the brokerage still expects a solid 14% earnings CAGR over FY25 to FY27. This reflects confidence in the company's medium-term growth, underpinned by its expanding specialty portfolio and strategic investments.

On a sequential basis, the company showed some improvement. Profit after tax (PAT) rose by 6% compared to the previous quarter, growing from Rs 2,150 crore in Q4FY25 to Rs 2,278 crore in Q1FY26. Revenue also increased by 8% from Rs 12,816 crore in the previous quarter.

Sun Pharma EBITDA

The EBITDA for the quarter reached Rs 4,302 crore, reflecting a 19.2% growth year-on-year. Moreover, EBITDA margins improved to 31.1%, indicating greater operational efficiency and better cost management.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.