Sun Pharmaceutical Industries Ltd is Rated Buy

Current Rating and Its Significance

The 'Buy' rating assigned to Sun Pharmaceutical Industries Ltd indicates a positive outlook on the stock, suggesting that investors may consider accumulating shares based on its present valuation and growth prospects. This rating reflects a balanced assessment of the company’s quality, valuation, financial trends, and technical indicators. While the rating was adjusted on 16 December 2025, the current data as of 09 January 2026 confirms the stock’s continued appeal within the Pharmaceuticals & Biotechnology sector.

Quality Assessment: Strong Fundamentals

As of 09 January 2026, Sun Pharma maintains an excellent quality grade, underscoring its robust business model and operational strength. The company exhibits healthy long-term growth, with net sales increasing at an annual rate of 11.10% and operating profit expanding at 21.96%. This consistent growth trajectory highlights the firm’s ability to generate sustainable earnings over time.

Moreover, Sun Pharma’s low debt profile is a significant quality marker. The average Debt to Equity ratio stands at zero, indicating a virtually debt-free balance sheet. This financial prudence reduces risk and enhances the company’s capacity to invest in growth opportunities without the burden of interest expenses.

Profitability metrics further reinforce the company’s quality credentials. The average Return on Equity (ROE) is 15.21%, signalling efficient utilisation of shareholders’ funds to generate profits. Additionally, the company’s operating cash flow for the year is at a peak of ₹4,198.77 crores, reflecting strong cash generation capabilities.

Valuation: Premium Pricing Reflects Market Confidence

Currently, Sun Pharma is considered expensive based on valuation metrics. This premium valuation is often justified by the company’s market leadership, consistent earnings growth, and strong balance sheet. Investors are willing to pay a higher price for the stock due to its perceived stability and growth potential within the pharmaceutical industry.

While the elevated valuation may temper near-term upside, it also reflects confidence in the company’s ability to maintain its competitive edge and deliver shareholder value over the medium to long term. Investors should weigh this premium against the company’s quality and financial trends when considering entry points.

Financial Trend: Positive Momentum

The financial grade for Sun Pharma is positive, indicating favourable trends in key financial indicators. The company’s dividend per share (DPS) is at its highest level of ₹16.00, signalling a shareholder-friendly approach and steady cash returns. Cash and cash equivalents are also robust, with ₹122,574.20 crores reported in the half-year period, providing ample liquidity for operational needs and strategic investments.

Stock returns as of 09 January 2026 show a mixed but generally positive trend. The stock has delivered a 1-year return of -4.01%, reflecting some recent volatility, but shorter-term performance is more encouraging with a 3-month gain of 5.75% and a 6-month gain of 5.19%. Year-to-date returns stand at 1.97%, indicating a modest recovery and renewed investor interest.

Technicals: Mildly Bullish Outlook

From a technical perspective, Sun Pharma is rated mildly bullish. This suggests that the stock’s price action and momentum indicators are supportive of a gradual upward trend, though not without some fluctuations. The recent 1-day change of -0.44% and 1-week gain of 1.35% reflect typical market movements within a broader positive technical framework.

Investors relying on technical analysis may find this mildly bullish stance encouraging for medium-term positioning, especially when combined with the company’s strong fundamentals and positive financial trends.

Institutional Confidence and Market Position

Institutional investors hold a significant 36.79% stake in Sun Pharma, which is a noteworthy endorsement given their expertise and resources in analysing company fundamentals. This level of institutional ownership often contributes to stock stability and can be a positive signal for retail investors.

Sun Pharmaceutical Industries Ltd is also ranked among the top 1% of companies rated by MarketsMOJO out of over 4,000 stocks, underscoring its elite status in terms of quality and investment appeal.

What This Rating Means for Investors

The 'Buy' rating on Sun Pharmaceutical Industries Ltd suggests that the stock is expected to outperform the broader market over the coming months, supported by its strong fundamentals and positive financial trends. Investors should consider this rating as an indication of the company’s solid growth prospects and relative safety compared to peers.

However, the premium valuation calls for careful timing of purchases, as the stock price already reflects much of the company’s strengths. Long-term investors may find value in the company’s consistent profitability, low debt, and strong cash flows, while those with a shorter investment horizon should monitor technical signals and market conditions closely.

Overall, the current 'Buy' rating reflects a balanced view that combines quality, financial health, and market sentiment, making Sun Pharma a compelling option for investors seeking exposure to the Pharmaceuticals & Biotechnology sector.

Summary of Key Metrics as of 09 January 2026

• Mojo Score: 72.0 (Buy Grade)


• Market Capitalisation: Large Cap


• Net Sales Growth (Annual): 11.10%


• Operating Profit Growth (Annual): 21.96%


• Debt to Equity Ratio (Average): 0.00


• Return on Equity (Average): 15.21%


• Operating Cash Flow (Yearly): ₹4,198.77 crores


• Dividend Per Share (Yearly): ₹16.00


• Cash and Cash Equivalents (Half Yearly): ₹122,574.20 crores


• Institutional Holdings: 36.79%


• Stock Returns: 1D: -0.44%, 1W: +1.35%, 1M: -1.27%, 3M: +5.75%, 6M: +5.19%, YTD: +1.97%, 1Y: -4.01%