Sun pharma advanced research co has issued a formal clarification to BSE Limited following an inquiry about increased trading volume in its shares on March 27, 2026.

Regulatory Compliance Confirmation

The pharmaceutical research company confirmed its adherence to all applicable disclosure requirements under SEBI regulations. The clarification was submitted in response to BSE's communication reference L/SURV/ONL/PV/SG/ 2025-2026 / 1006.

SEBI Regulation 30 Compliance

The company specifically addressed compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. This regulation mandates timely disclosure of material events and information that could impact investor decisions.

Kajal Damania, Company Secretary and Compliance Officer, digitally signed the communication confirming that:

• All required disclosures under Regulation 30 have been made to exchanges
• The company is not aware of any undisclosed information qualifying for disclosure
• The organization remains committed to adequate and timely disclosures

Market Surveillance Response

The clarification represents a standard response to stock exchange surveillance mechanisms designed to monitor unusual trading activity. BSE's inquiry followed observed volume increases, prompting the regulatory compliance confirmation from the pharmaceutical research company.

The company requested BSE to take the clarification on record, maintaining transparency in its communication with market regulators and stakeholders.

Sun Pharma Advanced Research Company Limited has submitted an addendum to its valuation report following clarifications requested by the National Stock Exchange of India Limited regarding the company's Extra-Ordinary General Meeting application. The pharmaceutical research company filed the regulatory disclosure on February 24, 2026, addressing specific queries raised by NSE on February 19, 2026.

Regulatory Background and Timeline

The addendum follows the company's earlier intimation dated January 29, 2026, regarding a corrigendum to the EGM Notice. Subsequently, SPARC submitted an application for in-principle approval under the SEBI (ICDR) Regulations to the stock exchange, which prompted NSE's request for additional clarifications on the valuation methodology.

Key Clarifications in Valuation Report

The addendum, prepared by registered valuer Mr. Jinesh Shah (IBBI Membership Number: IBBI/RV/06/2019/11939), addresses two primary areas of NSE's queries. The first clarification pertains to the scope of information, where unaudited financial statements for the quarter ended September 30, 2025, are now specified as being duly approved by the Board and subjected to limited review by statutory auditors.

DCF Method Exclusion Rationale

The most significant portion of the addendum explains why the Discounted Cash Flow (DCF) method was not employed in the company's valuation. The registered valuer provided detailed reasoning based on the company's unique business characteristics as a clinical-stage biopharmaceutical research and development entity.

Business Model Constraints

SPARC's operations focus predominantly on three key areas that present valuation challenges:

• Pre-clinical research activities
• Clinical trial execution across multiple phases
• Development of novel pharmaceutical technologies

These activities require continuous investment outflows while revenue inflows arise only upon successful late-stage development, out-licensing, or commercialization of product candidates. The valuer noted that drug development inherently carries very low probability of success, making future licensing income, product revenues, or royalty streams contingent and speculative.

Revenue Predictability Issues

The addendum emphasizes that SPARC lacks established or recurring revenue-generating business models, with operations remaining predominantly focused on research and clinical development. Any potential income from R&D outcomes is characterized as inherently uncertain, irregular in timing, and contingent upon scientific progress, regulatory milestones, and external partnering decisions.

Income Approach Limitations

The valuer explained that the Income Approach, including both Price Earnings Capitalization Value (PECV) and DCF methods, requires stable future economic benefits. Since SPARC has incurred persistent operational losses over preceding financial years, there are no sustainable or maintainable earnings to capitalize. The company's management has not furnished financial projections, further supporting the decision to exclude income-based valuation methods.

Document Availability and Compliance

The complete addendum to the valuation report has been made available on the company's website under statutory disclosures for shareholders' meetings. Company Secretary and Compliance Officer Kajal Damania signed the regulatory filing, ensuring compliance with Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The submission addresses NSE's concerns while maintaining the original valuation methodology's integrity, providing transparency regarding the specialized nature of clinical-stage biopharmaceutical company valuations and the inherent challenges in applying traditional income-based approaches to such entities.