Sun Pharma slides 3% on BoA's 'underperform' rating
Sun Pharma's stock slid nearly 3% to ₹1,610 on Tuesday after Bank of America cut its rating from "neutral" to "underperform."
The main reasons? The stock's high price and slower progress in its specialty drug business.
Ilumya's challenges are now Sun Pharma's worries
If you follow stocks or pharma news, here's the scoop: Sun Pharma is under pressure because Ilumya—its big money-maker—faces pricing cuts and more competition.
Nearly 75% of Ilumya's revenue comes from Medicare Part B, so even a 10% price drop could dent earnings by about 4%.
While Ilumya started strong, challenges with insurance payments and rivals are making future profits less certain.
Technical indicators show bearish sentiment
Sun Pharma shares have dropped over 14% so far this year and are now trading below key averages—a sign investors aren't feeling too confident.
The stock is also looking expensive compared to its own history, which adds to the cautious mood around it right now.