‘Buy’ Sun Pharma stock after Organon deal - HDFC Securities explains why; share price target
HDFC Securities maintained a 'Buy' rating on Sun Pharma stock and raised its target price to Rs 2,030 after the company announced an agreement to acquire US-based Organon & Co. The deal values Organon at an enterprise valuation of $11.75 billion and is expected to close in early 2027.
Sun Pharmaceutical Industries Ltd shares traded flat on Tuesday after gaining over 7% in the previous session following an agreement to acquire US-based Organon & Co in an all-cash transaction. HDFC Securities maintained its 'Buy' rating and raised its target price to Rs 2,030. The deal values Organon at $11.75 billion enterprise valuation, with Sun Pharma acquiring 100% of Organon's shares at $14 per share. The acquisition is expected to expand Sun Pharma's innovative medicine portfolio to 27% by FY26E and generate cost synergies of over $350 million within the next two to four years. Sun Pharma will finance $2-2.5 billion through internal accruals and raise $1.5-2 billion through debt. The merger is expected to close in early 2027, after which Organon will be delisted from the New York Stock Exchange.
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