Sun Pharmaceutical Industries Ltd: Why Is It Outperforming Nifty 500?

Sun Pharmaceutical Industries Ltd's latest quarterly results (Dec 2025) show

• PAT Growth YoY: +16.1% (turning around (inflection up))
• Revenue Growth YoY: +13.5%
• Operating Margin: 32.0% (expanding)

Sun Pharmaceutical Industries Ltd's profit is growing with an turning around (inflection up) trend.

• PAT Growth YoY: +16.1% (latest quarter)
• PAT Growth QoQ: +8.2% (sequential)
• 3-Year PAT CAGR: +47.9%
• Trend: Turning around (inflection up) — consistent growth pattern

Sun Pharmaceutical Industries Ltd's revenue growth trend is stable.

• Revenue Growth YoY: +13.5%
• Revenue Growth QoQ: +7.2% (sequential)
• 3-Year Revenue CAGR: +10.8%

Sun Pharmaceutical Industries Ltd's operating margin is expanding.

• Current OPM: 32.0%
• OPM Change YoY: +3.0% basis points
• OPM Change QoQ: +1.0% basis points

Sun Pharmaceutical Industries Ltd's long-term compounding rates

• 3-Year Profit CAGR: +47.9%
• 3-Year Revenue CAGR: +10.8%

Sun Pharmaceutical Industries Ltd's earnings growth is turning around (inflection up) with positive momentum on a sequential basis.

• YoY Acceleration: +13.2% bps
• Sequential Acceleration: -28.1% bps

Sun Pharmaceutical Industries Ltd's trailing twelve month (TTM) performance

• TTM PAT: ₹11,000 Cr
• TTM PAT Growth: -4.5% YoY
• TTM Revenue: ₹57,000 Cr
• TTM Revenue Growth: +10.1% YoY
• TTM Operating Margin: 30.8%

Sun Pharmaceutical Industries Ltd appears significantly undervalued based on our fair value analysis.

• Valuation Signal: Significantly Undervalued
• Current PE: 36.5x
• Price-to-Book: 5.7x

Sun Pharmaceutical Industries Ltd's current PE ratio is 36.5x.

• Current PE: 36.5x
• Market Cap: 4.4 Lakh Cr
• Dividend Yield: 0.87%

Sun Pharmaceutical Industries Ltd's current PE is 36.5x.

• Current PE: 36.5x
• Valuation Assessment: Significantly Undervalued

Sun Pharmaceutical Industries Ltd's price-to-book ratio is 5.7x.

• Price-to-Book (P/B): 5.7x
• Book Value per Share: ₹324
• Current Price: ₹1848

Sun Pharmaceutical Industries Ltd is rated Strong with a fundamental score of 70.9/100. This score is calculated from objective financial metrics

• Revenue Growth YoY: +13.5% (10% weight)
• PAT Growth YoY: +16.1% (10% weight)
• PAT Growth QoQ: +8.2% (10% weight)
• Margins expanding (10% weight)

Sun Pharmaceutical Industries Ltd has a debt-to-equity ratio of N/A.

• Total Debt: ₹5,000 Cr

Sun Pharmaceutical Industries Ltd's return ratios over recent years

• FY2023: ROCE 16.0%
• FY2024: ROCE 17.0%
• FY2025: ROCE 20.0%

Sun Pharmaceutical Industries Ltd's operating cash flow is positive (FY2025).

• Cash from Operations (CFO): ₹14,000 Cr
• Free Cash Flow (FCF): ₹9,000 Cr
• CFO/PAT Ratio: 128% (strong cash conversion)

Sun Pharmaceutical Industries Ltd's current dividend yield is 0.87%.

• Dividend Yield: 0.87%
• Current Price: ₹1848

Sun Pharmaceutical Industries Ltd's shareholding pattern (Mar 2026)

• Promoters: 54.5%
• FII (Foreign): 15.9%
• DII (Domestic): 21.0%
• Public: 8.5%

Sun Pharmaceutical Industries Ltd's promoter holding has remained stable recently.

• Current Promoter Holding: 54.5% (Mar 2026)
• Previous Quarter: 54.5% (Dec 2025)
• Change: 0.00% (stable)

Sun Pharmaceutical Industries Ltd has been outperforming Nifty 500 for 2 consecutive weeks, indicating early-stage outperformance.

Sun Pharmaceutical Industries Ltd is a re-entry — it briefly dropped off the outperformance list but has now returned. Re-entries can signal renewed strength.

Sun Pharmaceutical Industries Ltd has 4 key risks worth monitoring

• [HIGH] Regulatory — OAI status at certain manufacturing sites is blocking new ANDA launches; management acknowledged the issue is specific competition plus site compliance, not price erosion alone
• [MEDIUM] Regulatory — MFN pricing, if implemented, could pressure pricing on innovative medicines sold in the US including Ilumya, LEQSELVI, and UNLOXCYT
• [LOW] Fx — Emerging market revenue growth of 21.6% included a currency tailwind; constant currency growth of 13% is the underlying rate, suggesting FX reversal would reduce reported numbers
• [MEDIUM] Geopolitical — Pharma tariffs and MFN pricing are both active US policy levers that could affect Sun's US business, which accounts for 27.5% of consolidated revenue

In Q3 FY26, Sun Pharmaceutical Industries Ltd's management highlighted

• "the generic business will start to recover once we are in manufacturing compliance for a number of our sites in order to launch new products [Risk (r..."
• "There is a voluntary model that exists today... the other two are proposed. So they are very much in the notice and comment phase. We expect that noti..."
• "FOREX gain during the quarter was Rs.1,539 million. The underlying growth in constant currency terms was 13% [Risk (fx): LOW]"

Based on quantitative research signals, here is why Sun Pharmaceutical Industries Ltd may be worth studying

• Earnings growing at +16.1% YoY
• Operating margins are expanding — OPM at 32.0%
• Valuation: appears significantly undervalued
• Cash flow is positive — CFO ₹14,000 Cr

Sun Pharmaceutical Industries Ltd investment thesis summary:

Sun Pharmaceutical Industries Ltd's forward outlook based on current data signals

• Earnings Trend: turning around (inflection up)
• Revenue Trend: stable
• Margin Trend: expanding
• Valuation: Significantly Undervalued
• Key Risk: Regulatory