Pharma Stocks Outlook
Up next wk on reasonable valuations, risk-off
This story was originally published at 19:19 IST on 2 August 2024
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MUMBAI – With risk-aversion taking hold of global financial markets over the last few days, shares of pharmaceutical companies are likely to extend their outperformance over the larger market and gain further next week, according to analysts. The pharmaceutical sector is expected to find favour with investors not only by virtue of being a defensive play, but also due to reasonable valuations.
Recent earnings of giants Cipla and Sun Pharmaceutical Industries have reinforced the bullish outlook for core businesses of most pharmaceutical players, especially those that operate in niche areas such as inhalation, oncology or specialty drugs. The pricing environment for the generic business remains steady while regulatory clearances in recent months have also set teh stage up for many new launches, say experts.
"On a sectoral level, the pharma industry stands out, with the pharma index reaching an all-time high and closing up 1.6% this week," Krishna Appala, a senior research analyst at Capitalmind Research said. Pharmaceutical stocks could present promising investment opportunities in the near term, due to favourable valuations and the fact that they been overlooked in recent years, he said.
Next week, shares of Biocon, Lupin, Zydus Lifesciences, Abbott India, JB Chemicals and Pharmaceuticals, Sun Pharma Advanced Research Co will be in focus as these drugmakers are scheduled to report earnings in the coming sessions, while shares of Divi's Laboratories will also react to its results, to be declared on Saturday.
TOP HEADLINES
* Alembic Pharma gets US FDA final nod for Nelarabine injection
* Nestle India subscribes to 705.6 mln shares of JV with Dr Reddy's
* Motion filed in US court against Sun Pharma's LEQSELVI tablets
* Earnings Review: Sun Pharma consol PAT rises on strong domestic sales
* Sun Pharma Apr-Jun consol net profit up 40% on yr at 28.36 bln rupees
* Earnings Review: India drug sales prop up Mankind Pharma's bottomline
* Earnings Outlook: Unichem ops, Indian business to benefit Ipca Labs
* Mankind Pharma Apr-Jun consol PAT up over 10% YoY at 5.36 bln rupees
* Zydus Life gets Mexican drug body nod for biosimilar of cancer drug
* HDFC MF raises stake in Piramal Pharma to 7.1% from 5.0%
* Earnings Outlook: Stellar biologics ops to boost Biocon's Apr-Jun
* Piramal Pharma to sell unit in Thane for 90 mln rupees
* Earnings Outlook: Robust India ops, exports to aid Mankind Pharma
* Ajanta Pharma Apr-Jun consol PAT rises 18.1% YoY to 2.46 bln rupees
* Granules India Apr-Jun consol PAT up nearly 3-fold YoY at 1.35 bln rupees
* Earnings Outlook: US ops recovery to boost Aurobindo Pharma earnings
* PRESS: Torrent Pharma to buy 54% in JB Chem for 170-180 bln rupees
* Europe drug agency panel positive on Dr Reddy's Rituximab biosimilar
* US FDA conducts inspection at Biocon's Bengaluru facility
* Earnings Review:Dr Reddy's beats view but price pressure, costs weigh
* Dr Reddy's says JV with Nestle India to be operational from Aug 1
* Dr Reddy's board OKs stock split, pref shr investment in Swiss arm
* Dr Reddy's Apr-Jun consol PAT dn 0.9% on yr but beats Street's view
* Earnings Review: Bumper US sales help Cipla beat Apr-Jun estimate
* Cipla raises US quarterly sales runrate view to $235 mln-$240 mln
* Sanofi India Apr-Jun PAT falls 16% YoY, sales fall 10%
* Cipla reports 18.3% surge in consol PAT as US ops strong in Apr-Jun
* Earnings Outlook: Divi's Labs Apr-Jun PAT seen up 37% on year
* US FDA issues zero observation to Alembic Pharma:'s Panelav unit
Following are the resistance and support levels for the sector's key stocks for next week, as per calculations based on their prices on the National Stock Exchange:
| Company | Price | Week-on-Week Change in % | Resistance | Support |
| Abbott India | 28227.70 | (-)1.30 | 29053.20 | 27527.30 |
| Alkem Laboratories | 5295.75 | 0.10 | 5424.50 | 5135.60 |
| Aurobindo Pharma | 1443.30 | 4.10 | 1469.50 | 1406.00 |
| Biocon | 356.10 | (-)3.40 | 370.30 | 341.00 |
| Cipla | 1528.80 | (-)2.90 | 1549.00 | 1513.60 |
| Divi's Laboratories | 4991.25 | 4.20 | 5117.70 | 4775.90 |
| Dr Reddy's Laboratories | 6964.15 | 1.20 | 7046.40 | 6833.30 |
| Gland Pharma | 2126.65 | 5.50 | 2189.20 | 2042.20 |
| GlaxoSmithKline Pharmaceuticals | 2820.25 | 4.20 | 2940.00 | 2660.20 |
| Glenmark Pharmaceuticals | 1443.05 | 0.30 | 1474.10 | 1399.50 |
| Granules India | 646.10 | 14.70 | 667.20 | 611.60 |
| Ipca Laboratories | 1300.30 | 1.20 | 1330.90 | 1264.70 |
| Laurus Labs | 447.10 | (-)0.40 | 462.50 | 429.30 |
| Lupin | 1961.50 | 6.60 | 2009.20 | 1911.20 |
| Natco Pharma | 1367.65 | 2.50 | 1397.80 | 1316.90 |
| Pfizer | 5658.30 | 7.90 | 5750.10 | 5505.90 |
| Sanofi India | 6567.00 | (-)1.60 | 6684.20 | 6486.40 |
| Sun Pharmaceutical Industries | 1731.65 | 1.00 | 1777.10 | 1661.20 |
| Torrent Pharmaceuticals | 3228.10 | 1.00 | 3323.80 | 3131.60 |
| Zydus Lifesciences | 1249.90 | 3.60 | 1277.80 | 1213.70 |
| Nifty Pharma | 21902.85 | 1.40 | 22288.70 | 21335.80 |
| Nifty 50 | 24717.70 | (-)0.50 | 24917.20 | 24587.10 |
| S&P Bse Sensex | 80981.95 | (-)0.40 | 81542.20 | 80588.80 |
End
Reported by Apoorva Choubey
Edited by Aditya Sakorkar
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