Sun Pharmaceutical Industries Limited Valuation
SUNPHARMA · Healthcare · Current price ₹1,758.8
Is Sun Pharmaceutical Industries Limited undervalued?
We estimate the fair value of Sun Pharmaceutical Industries Limited at ₹2,793 per share, against a market price of ₹1,840. That puts the share price about +51.8% below our estimate, at medium confidence. This is our view of what the business is worth, not a target price or a forecast of where the share price will go.
How this fair value is calculated
This estimate comes from 1 method: Fair multiple (P/E) (₹2,793). Each is weighted by how well its inputs held up for this company. The full working, including the assumptions and what data was missing, is set out below.
The range around this estimate
Our estimate for Sun Pharmaceutical Industries Limited spans ₹2,514 to ₹3,073. A margin of safety means buying meaningfully below the estimate: the wider the range, the more room the assumptions leave for error.
Valuation multiples
Sun Pharmaceutical Industries Limited trades at a P/E of 36.8x and a P/B of 5.3x, with a dividend yield of 0.9%. Multiples are most useful compared against the company's own history and its sector peers — see the peer comparison for context.
How we got this fair value
Every number below is part of the same estimate for Sun Pharmaceutical Industries Limited. Nothing here is a target price or a forecast of where the share price will go.
Workable, with real gaps. Weigh it alongside your own view rather than on its own.
Estimate range ₹2,514 – ₹3,073
Why this method for this business
Sun Pharma is an asset-light compounder with a durable moat, making relative P/E and EV/EBITDA the most appropriate models. DCF is less suitable due to the complexity of valuing a pharmaceutical company with global operations and R&D-driven growth.
The models behind the number
Each method is weighted by how well its inputs held up for this company.
required inputs missing
- dcf: Complex and less suitable for a pharmaceutical company with global operations and R&D-driven growth
- peer-median P/E: Not sufficiently representative of the company's unique position and growth prospects
What was missing
- Lack of detailed information on the company's R&D pipeline and future product launches
- Limited data on the impact of the patent expiry wave on the company's revenue and margins
What drives it
15 inputs, grouped by how strong each claim is
- Sector-median P/E
- 36.9×
- Peers used
- 18
- EPS (TTM)
- 50.41 ₹/share
- Own-history median P/E
- 38.08×
peer-median
peer-median
computed
reconstructed (one feature, dampened — not a cap)
- Term: quality
- -3.2%
- Term: growth
- +40.0%
- Term: capital_allocation
- +6.8%
- Term: financial_strength
- +1.6%
- Term: history
- +1.0%
- Term: sector_rerating
- +0.0%
- Term: rate_regime
- +1.2%
- Term: risk
- +0.0%
quality 48/100 (weak/erratic returns) → discount
durable ~25% CAGR (ROCE 17% > hurdle) → premium
capital allocation: rising ROCE funded by strong FCF → premium
financial strength: moderate leverage (D/E 0.6) → neutral
history: market paid +3% vs sector, dampened ×0.3 (one feature, not the anchor)
sector re-rating: no sector-norm history → not used
rates: risk-free 6.9% below ~7.1% normal → higher multiple
risk: no analyst-dispersion signal available → neutral (lowers confidence, not PE)
- Premium vs sector
- +50.2%
- Fair-multiple confidence
- 85%
- Fair P/E
- 55.41×
fundamentals + macro (not capped at own history)
data completeness + term agreement
sector median × ∏(1+term) — Dynamic Fair Multiple
Who computed this
A language model (qwen3:8b) selects the valuation method and the judgement inputs for Sun Pharmaceutical Industries Limited: which models suit the business, the moat, the growth and margin assumptions. It does not produce the number. The fair value itself is computed in Python by a deterministic engine (version 2026.08.1) from those inputs, so the same inputs always give the same result and every figure above can be traced to a source.
Estimated 14 Sept 2026. Re-run as new financials and news arrive.
How we value stocks
We estimate what a business is worth from its own economics: cash flows, returns on capital, and a multiple justified by its quality, rather than from where the share price has been. A fair value estimate is a view, not a verdict, and it is only as good as the inputs listed above.
Read the full fair-value methodologyUnderstand the ratios
More on Sun Pharmaceutical Industries Limited
DocStoX estimates are computed from reported financials, for informational purposes only, not investment advice. Consult a SEBI-registered advisor before investing.