Sun Pharma: Specialty driven growth priced-in; Focus on post OGN valuations

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Sun Pharma: Specialty driven growth priced-in; Focus on post OGN valuations

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Sun Pharma

Specialty driven growth priced-in; Focus on

post OGN valuations

Reiterate Rating: UNDERPERFORM | PO: 1,720 INR | Price: 1,845 INR

Higher costs weigh on 4Q margins 23 May 2026

SUNP reported revenue growth of 13% and margin of 24% (vs. BofAe 26%) due to Equity

higher-than-expected operating costs. The 450bps decline in adj EBITDA margin in 4Q

was due to lower gRevlimid, seasonality as well as higher spend in US that co expects to

Key Changesnormalize in coming qtrs. The FY27 guidance of high single digit growth and R&D spend

of 6-7% were broadly in line with expectation but SUNP indicated that the higher (Rs) Previous Current

specialty related spend will continue as the base to support new launch growth (vs. Price Obj. 1,670.00 1,720.00

street expectation of moderation post launch). Therefore, we expect margins to remain 2027E Rev (m) 659,677.6 663,127.8

at 28% levels (ex OGN) with growth in specialty being key. 2028E Rev (m) 737,213.7 749,999.6

2029E Rev (m) NA 830,860.1

2027E EPS 53.21 53.10Specialty momentum – New launch traction key

SUNP reported FY26 specialty revenue growth of 16% (ex-milestone) that was aided by 2028E EPS 60.22 61.75

Ilumya (+17% YoY) in the US. The Ilumya growth is higher than Rx trend (12.5% YoY as 2029E EPS NA 69.13

per IQVIA) with the continued growth of IL23s in psoriasis as well as upcoming PsA

indication launch (goal date in Oct-26) supporting FY27-28 growth. SUNP also indicated Neha Manpuria >>

Research Analyst

positive response on Unloxcyt and is working with integrated healthcare systems for BofAS India

formulary including and traction in cancer centers. While IQVIA data show slow market +91 22 6632 8307 neha.manpuria@bofa.com