A profit warning from Sun Pharmaceutical Industries triggered a massive sell-off in the stock on Tuesday at the bourses. The stock crashed 14.95 per cent — the biggest-ever fall since its listing — to ₹805.30 on the BSE. The stock even dipped to sub-₹800 levels at ₹799.05 in intra-day trades.
Tuesday’s fall wiped out about ₹34,000 crore in market capitalisation, as the company warned that its 2016 sales would, at best, be flat due to charges related to the ongoing integration of Ranbaxy Laboratories.
But despite the steep fall, analysts are not yet recommending a ‘buy’ on the stock.
CEO of Equity Intelligence Porinju Veliyath tweeted, “Not to get excited with correction in Sun Pharma... discount the earnings of next many years already!”
Sun Pharma July futures added more short positions, with open interest surging almost 10 per cent to 1.62 crore shares on the NSE.
In the April-June quarter, Sun Pharma saw more FIIs buying the shares; their holding rose to 23.76 per cent from 18.82 per cent (at March end). Sun, which had acquired Ranbaxy earlier this year for $4 billion, said it hopes to revert to a more sustainable growth trajectory post-FY16.