Sun Pharma under a shadow

Sun Pharma is currently the top loser on the BSE, down 4.2% at Rs.823.40, with an intra day low at Rs.808, with volumes rising over two times.

Th stock has slumped into the red today on unconfirmed reports on TV that a surprise check was conducted at the company’s plant by a team of 5 USFDA inspectors. The checks began on Monday and it is said to be still going on. Though no observations have been known to be made yet, there is worry amongst the traders. If it turns out to be a minor observation, the stock could surge back but if it turns into something major, stock price could turn for the worst.

Concern is mounting as some FIIs had in July put out reports suggesting that there could be increased scrutiny at Sun after it recalled some 40,000 bottles of extended-release tablets from the US market. This was followed with a recall of some 200 vials of chemotherapy drugs. Till the USFDA releases its observation, the stock is likely to remain under pressure.