Sun Pharma shares gain 4% after declining 7% in past three days

The stock has moved higher by 4% to Rs 655, bouncing back 6% from its early morning low of Rs 620 on the BSE on Wednesday.

Shares of Sun Pharmaceutical Industries have moved higher by 4% to Rs 655 per share, bouncing back 6% from their early morning low of Rs 620 per share on the BSE on Wednesday.

The stock of drug firm has fallen 7% in past three trading days till Tuesday, on reports that company received six observations by US Food and Drug Administration (FDA) for Halol unit and inspection of the company’s Mohali facility. The stock hit a 52-week high of Rs 679 on September 9, 2018, in intra-day trade.

“The US FDA conducted a Pre-Approval Inspection (PAI) of Sun Pharmaceutical Industries’ Halol facility (Gujarat, India) from August 27, 2018, to August 31, 2018. At the conclusion of the inspection, the agency issued a Form 483, with six observations.

The Company will be submitting its response on the observations to the US FDA within 15 business days. Sun Pharma is committed to addressing these observations promptly,” the company said in clarification on news report on Thursday.

“The US FDA is conducting an inspection of the company’s Mohali facility (Punjab, India). The inspection started yesterday, September 10, 2018, and is ongoing.” Sun Pharma said on Tuesday on clarification on news report by saying no material impact of this article on the company.

The brokerage firm Motilal Oswal Securities believes the observations at Halol plant are resolvable and should not impact existing business and/or new approvals, pertaining to Sun Pharma.

“We believes, the incremental generics business from new launches, which should be higher than base business erosion, increased traction in specialty products and sustained outperformance in the domestic formulation business should drive growth,” the brokerage firm said in event update.

At 02:14 pm; Sun Pharma was trading 3.3% higher at Rs 652 on the BSE, as compared to 0.57% rise in the S&P BSE Sensex. A combined 9.46 million equity shares changed hands on the counter on the BSE and NSE so far.