Pharma Stocks Outlook
Seen lacklustre next week; earnings in focus
This story was originally published at 21:01 IST on 31 October 2024
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MUMBAI – Pharmaceutical stocks are seen lacklustre next week, as the overall sentiment in global financial markets remains weak due to worries over slowing economic growth, weakening corporate profits, and rising commodity prices. Action could be stock-specific, as a number of companies are set to detail earnings for Jul-Sept.
The Nifty Pharma index rose nearly 1% this week, marking an average performance among sectoral Nifty indices. In comparison, the Nifty 50 ended flat for the week.
As the defensive nature of the business makes the pharmaceutical sector a good defensive bet, investors may keep holding on to shares of drugmakers, according to market experts. However, weak September quarter earnings and muted demand outlook by some players may keep investors from putting in any incremental money in the pharmaceutical sector, they said.
Companies in the sector have reported a mixed set of results so far. While value-added and complex portfolios are doing well, there is a marked slowdown in demand for drugs that usually do better at this time of the year, such as acute therapy medications, the head of research at a local brokerage house said.
The likes of Cipla have indicated relatively lower growth in advanced markets, with slow pace of launches and supply issues in the US. Others, such as Sun Pharmaceutical Industries and Biocon, who work in niche segments of biosimilars and specialty drugs, have indicated strong momentum in the coming months.
Divi's Laboratories, Apollo Hospitals Enterprise, Mankind Pharma, Lupin, and Dr Reddy's Laboratories will be in focus as they will announce Jul-Sept earnings next week.
TOP HEADLINES
* Cipla gets US FDA voluntary action indicated tag for Goa facility
* Analyst Concall: Generics, research ops to help Biocon growth revive Oct-Mar
* Earnings Review: Biocon slips into red in Jul-Sept on weak sales, higher tax
* Analyst Concall: Dabur eyes aggressive play in hair oil with Sesa Care buy
* Earnings Review: Inventory correction makes Dabur post 18% PAT decline
* US FDA tags Biocon arm's Bengaluru unit as 'voluntary action indicated'
* Earnings Review: Dabur posts 18% decline in PAT on inventory correction
* Earnings Outlook: Weak research, generics ops to weigh on Biocon's Jul-Sept
* Analyst Concall: With huge cash in hand, Cipla eyes pdt buyouts in India, US
* Aurobindo Pharma arm invests INR 25 bln in Penicillin-G mfg unit in Andhra
* Cipla cuts lower band of US quarterly sales guidance as launches delayed
* Earnings Review: Cipla Jul-Sept consol net profit, revenue meet estimates
* GSK Pharma Jul-Sept net profit rises 15.4% YoY to INR 2.49 billion
* Analyst Concall: Sun Pharma sees R&D at 7-8% of sales due to pipeline delays
* Emcure Pharma to set up wholly-owned subsidiary, expand product portfolio
* Earnings Review: Sun Pharma Jul-Sept PAT growth led by US ops but pace slows
* Pfizer Jul-Sept net profit rises 6.3% on year to INR 1.58 billion
* Ajanta Pharma Jul-Sept consol PAT rises 10.8% YoY to INR 2.16 billion
* Dr Reddy's launches 'Elobixibat' in India to treat chronic constipation
* Poly Medicure Jul-Sept consol PAT rises 40.6% YoY to INR 874.55 million
* Rainbow Children's consol net profit up 25% on year at INR 788.69 million
* Analyst Concall: Torrent Pharma sees several tailwinds for margin expansion
* Earnings Review: Torrent Pharma Jul-Sept consol PAT growth lowest in 5 qtrs
* Eris Life Jul-Sept consol net profit falls nearly 26% YoY to INR 916 mln
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 | 28978.70 | 1.70 | 29773.70 | 27862.20 |
| Alkem Laboratories | 5779.25 | (-)2.80 | 5890.20 | 5708.00 |
| Aurobindo Pharma | 1396.50 | (-)2.20 | 1431.40 | 1371.50 |
| Biocon | 316.10 | 1.30 | 334.20 | 294.00 |
| Cipla | 1551.75 | 4.20 | 1593.20 | 1497.40 |
| Divi's Laboratories | 5889.65 | 1.90 | 5977.50 | 5814.80 |
| Dr Reddy's Laboratories | 1274.20 | (-)2.20 | 1304.30 | 1233.00 |
| Gland Pharma | 1651.10 | 2.80 | 1676.60 | 1611.10 |
| GlaxoSmithKline Pharmaceuticals | 2712.25 | 4.80 | 2808.10 | 2622.10 |
| Glenmark Pharmaceuticals | 1694.55 | 1.90 | 1721.00 | 1650.70 |
| Granules India | 569.60 | 5.60 | 584.50 | 544.50 |
| Ipca Laboratories | 1588.80 | 0.40 | 1620.20 | 1540.30 |
| Laurus Labs | 491.25 | 5.50 | 501.50 | 474.20 |
| Lupin | 2186.95 | 1.40 | 2230.10 | 2126.80 |
| Natco Pharma | 1402.95 | 8.60 | 1443.20 | 1344.30 |
| Pfizer | 5097.90 | (-)3.90 | 5202.40 | 5000.50 |
| Sanofi India | 6794.30 | 6.60 | 7054.30 | 6385.80 |
| Sun Pharmaceutical Industries | 1848.90 | (-)0.60 | 1884.90 | 1824.10 |
| Torrent Pharmaceuticals | 3202.65 | (-)6.70 | 3274.20 | 3112.20 |
| Zydus Lifesciences | 1001.25 | 1.10 | 1016.40 | 977.50 |
| Nifty Pharma | 22735.55 | 0.70 | 22919.70 | 22458.50 |
| Nifty 50 | 24205.35 | 0.10 | 24450.00 | 24050.30 |
| S&P Bse Sensex | 79389.06 | (-)0.00 | 80331.00 | 78817.00 |
End
Reported by Apoorva Choubey
Edited by Ashish Shirke
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