Sun Pharma Among Biggest Nifty Drags After Broker Downgrade; SEBI RA Sees Support At ₹1,528 - ₹1,552 Range

Shares of Sun Pharmaceutical Industries fell as much as 3.5% on Tuesday after brokerage firm BofA Securities reportedly downgraded the stock and trimmed its target price.

The stock closed 3.4% lower at ₹1,601.2 on Tuesday, making it the second-biggest loser by percentage change on the Nifty 50 index.

According to multiple reports, to BofA Securities downgraded Sun Pharma to ‘underperform’ from ‘neutral’ and slashed its target price to ₹1,570 from ₹1,730. The brokerage highlighted concerns around stretched valuations and weaker-than-expected traction in Sun Pharma’s speciality drug portfolio. 

It also flagged risks linked to the company’s psoriasis drug Ilumya, noting its heavy dependence on Medicare, exposure to pricing pressures, and limited earnings visibility despite a strong initial uptake.

According to the brokerage report, a 10% price cut in Ilumya could dent Sun Pharma’s EPS by about 4%, adding to investor concerns. 

Technical View

According to SEBI-registered Financial Sarthis, the stock is currently trading within a descending triangle formation, with repeated rejections from a downward sloping trendline. 

Price action is around the 0.618 Fibonacci retracement level, highlighting a crucial support area where the next move could be decided.

The analyst flagged support at ₹1,552 and ₹1,528, with resistance at ₹1,696 and ₹1,766 as key levels determining the stock’s movement. A breakout above ₹1,700 - ₹1,720, which aligns with the trendline and the 0.5 Fibonacci level, could trigger strong bullish momentum. 

On the downside, a breakdown below ₹1,625 on a closing basis would confirm weakness and may open the door for further downside, they added.

Volume trends add another layer of caution, with buying interest subdued on recent up-moves, reflecting weak conviction from bulls, the analyst added. A significant volume spike accompanying a breakout will be a critical confirmation signal for traders.

Retail Reaction

Retail sentiment on Stocktwits remained ‘bearish’. It was ‘neutral’ a week ago. 

Weak Q1 earnings and developments around Donald Trump-imposed tariff on Indian goods have seen the stock come under some pressure lately. The stock has shed nearly 6% over the past month. 

Year-to-date, Sun Pharma shares have declined over 15%.

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