Sun Pharmaceutical Share Price Climbs 3 Per Cent: Here’s Why

Sun Pharmaceutical's share price climbed over 3 per cent on March 11, to Rs 1663.45 at 12:11 pm, after the announcement of its acquisition of Checkpoint Therapeutics and buy rating by HDFC Securities. 

Sun Pharma's share price has risen over 5 per cent in the last 5 trading sessions. Sun Pharma stock price was trading in the green, up 2.76 per cent at Rs 1655.60 on March 11, at 2:00 pm, on NSE. The company shares hit a 52-week high on September 30, 2024, as per NSE at Rs 1,960.35.

The move is valued at approximately $355 million (approximately Rs 2,946.5 crore). Sun Pharma’s focus remained on expanding its speciality business, particularly in oncology, dermatology, and ophthalmology.

Sun Pharma is set to acquire all outstanding shares of Checkpoint for $4.1 per share in cash. 

This deal will add Unloxcyt (Cosibelimab) to its portfolio, targeting cutaneous squamous cell carcinoma. 

“The acquisition of Checkpoint aligns with our long-term growth strategy to strengthen our speciality portfolio,” Sun Pharma stated. “We continue to focus on high-value therapies in key areas such as dermatology and oncology.”

HDFC Securities Research report has reiterated a ‘BUY’ rating on Sun Pharma’s stock, with a revised target price of Rs 1,970 from its current price.

Sun Pharma anticipated launching Unloxcyt in the US market once the deal closes by September 2025. The drug is also awaiting regulatory filings in the European Union, where the global market for similar treatments is estimated to be valued between $40 billion and $50 billion.

The US market opportunity for Unloxcyt is around USD 1 billion, with a global potential of $40-50 billion. Sun Pharma expects a 10 per cent sales CAGR for FY24-27, with an improving EBITDA margin.

The report added that Sun Pharma’s speciality pipeline already included promising candidates such as Ilumya (for psoriatic arthritis), GL0034 (for obesity), MM-II (for osteoarthritis), and Fibromun (for soft tissue sarcomas and glioblastoma). HDFC Securities expected this acquisition to further solidify the pharma company’s position in the immuno-oncology space.

Meanwhile, the company reported an 11 per cent compound annual growth rate (CAGR) in sales and 15 per cent earnings before interest, taxes, depreciation and amortization (EBITDA) CAGR over FY19-24. Looking ahead, Sun Pharma expected a 10 per cent CAGR in sales through FY27, with EBITDA margins projected to increase from 26.8 per cent in FY24 to 29.1 per cent in FY27.