Nomura remains neutral on Sun Pharma

Nomura has maintained its Neutral rating on Sun Pharmaceutical Industries after the company's US arm Caraco's Michigan facility received US FDA clearance. Nomura feels that the FDA clearance is positive but marginal. The company maintains a target price of Rs.690.

Sun Pharma announced that following FDA inspection earlier this year, Caraco has received US FDA clearance for its Michigan facility. Caraco can commence manufacturing of Carvedilol and Paromomycin at this facility. The clearance is expected only on a product-by-product basis and Nomura expects it to be a gradual ramp up in manufacturing.

Sun Pharma trades at 19.2x and 19.7x FY13F and FY14F EPS and 12.8x FY13/14F EV/EBITDA. Nomura maintains its Neutral recommendation.

Source : Equity Bulls

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