Edit: 27-03-2020
Even when we study the technical chart of Sun Pharma, we don't see any exceptional changes. The stock is still in the grab of bears. At the current levels, the stock has average support around Rs.354, if it breaks that level also then we can see new low levels of Rs.270. In the bad times when the World faces Covid-19 challenges pharma may gain something out of it. The stock made a low of Rs.315.05 in such hazardous conditions.
Edit: 02-09-2019
The pharma sector has been struggling with many issues, with the rise in pollution, bad eating habits, clean water problems, the sales of medicines is on the rise but that factor isn’t working in the profitability of the Pharma Companies. The way we here the cost of medical treatment that should reflect on the profitability but that isn’t the case. Now, let’s come to the main question asked, factoring all the pros and cons I do believe that the stock is slowly moving towards the levels of Rs.500 and once it takes support above it on the weekly and monthly basis, I do expect the stock be going towards Rs.612. We have to maintain an investment stop loss of around Rs.415.
04–09–2019 (SEBI has ordered Forensic Audit, so we have put the stock under review. After looking into the outcome we will decide the next strategy.)
The reason the stock took so much heat was because of the whistleblower complaint that resulted in value erosion for the investors in the span of a few months. The main promoter didn’t sell any of the shares but the way hipe was created that it looked like everything will collapse and when a few days back when SEBI gave clean chit, the question to be asked is only that who will take the responsibility of the value erosion, around Rs.8,500 Crore is invested through mutual funds, the money of middle class. India as a market is starting to get matured and it will take time because we every now and then hear about some scam, so it is easy to target any of the reputed companies on the grounds of some frauds. The way Sun Pharma has worked all these years and is the leading company I was in shock to see such a sharp fall in the value, but as analysts, we do have to value the market scenario and technical charts, we cannot go by the brand name or the name of the promoter, we only see the truth. Still, just by the clean chit, everything won’t work out in the favour of the company but it would at least stop erosion for the time being.
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