Pharma Stocks Outlook
Seen range-bound but defensive play may boost buying
This story was originally published at 21:31 IST on 13 March 2025
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MUMBAI – Shares of pharmaceutical companies are expected to remain range-bound next week due to lack of major triggers for the sector. Investors will remain on the lookout for updates about US trade policies as they may have a major bearing on this largely export-dependent sector. Being a 'defensive' sector, pharma stocks could also see some buying as investors may turn slightly risk-averse due to uncertainty in the overall market.
The Nifty Pharma index was among those sectoral indices that fell the least this week. It closed the week marginally higher at 20386.85 points. In comparison, the benchmark Nifty 50 fell 0.3%. Other sectoral indices Nifty Auto and Nifty IT fell 2-5%. Shares of Gland Pharma and Natco Pharma fell more than 5% this week, while those of Sun Pharmaceutical Industries rose nearly 5%.
As several tariffs announced by the US administration are beginning to take effect, market watchers await any statements from US President Donald Trump that may provide clarity about tariffs that could be imposed on pharma products. In February, Trump had signalled that his administration would impose tariffs of around 25% on pharma products. Pharma could be one of the worst hit sectors if Trump imposes sector-wise tariffs, as drugs and medical therapy-linked products account for the second-largest bulk of exports to the US after electrical goods, according to analysts.
Shares of companies that provide acute therapies are trading at an implied valuation of 30 to 35 times the earnings per share for 2026-27 (Apr-Mar), and those that make drugs for chronic diseases are trading at 35 to 40 times. "These valuations imply the ongoing steady decline in the share of branded generics will continue and do not factor in any further growth deceleration in the next few years," Kotak Institutional Equities said in a report. If the market share of branded generics makers falls further, there is scope for further de-rating of these stocks, the brokerage firm said. Sun Pharma, Cipla, Lupin, JB Chemicals, and Emcure Pharmaceuticals are the brokerage's preferred picks in the sector.
TOP HEADLINES
* ANALYSIS: Pharma, healthcare cos beat view on PAT, sales fronts for Dec quarter
* Zydus Life arm invests in Illexcor to develop sickle cell disease oral drug
* US FDA tags Jubilant Pharmova arm's Maryland unit 'voluntary action indicated'
* Max Health to ink pact with Bharat Prakritik for 200-bed hospital in Delhi
* Zydus Life gets US FDA final OK to manufacture Methenamine Hippurate tablets
* Glenmark Pharma launches cardiovascular-diabetes drugs under Glempa brand
* Alkem Lab launches generic empagliflozin in India under "Empanorm" brand
* Zydus Life board OKs buying 85.6% stake in France-based Amplitude Surgical
* Syngene Intl to make additional investment of up to $56 mln in US arm
* Syngene Intl arm buys its first biologics facility in US for $50 mln
* Zydus Life gets US FDA final approval to manufacture Ketoconazole shampoo
* Glenmark Pharma's US arm launches polyethylene glycol 3350 powder
* Sun Pharma to buy Checkpoint Therapeutics, to pay up to $355 mln upfront
* USFDA issues no observations to JB Chem's mfg facility in Gujarat
* Biocon arm phase 3 study for Ustekinumab biosimilar Yesintek successful
* US FDA issues 1 procedural observation to Alembic Pharma facility in Gujarat
* Lupin launches Rivaroxaban tablets in US
Following are the resistance and support levels for the stocks for next week as per calculations by Informist based on their prices on the National Stock Exchange:
| Company | Price | Week-on-Week Change in % | Resistance | Support |
| Abbott India | 29597.00 | (-)3.80 | 30311.70 | 29199.20 |
| Alkem Laboratories | 4706.95 | (-)0.70 | 4821.30 | 4624.20 |
| Aurobindo Pharma | 1094.75 | (-)0.20 | 1127.70 | 1073.50 |
| Biocon | 323.05 | (-)3.20 | 328.70 | 318.70 |
| Cipla | 1461.90 | 0.20 | 1477.80 | 1437.70 |
| Divi's Laboratories | 5620.45 | 0.80 | 5815.20 | 5506.70 |
| Dr Reddy's Laboratories | 1107.95 | (-)2.20 | 1119.60 | 1089.20 |
| Gland Pharma | 1554.85 | (-)5.30 | 1614.50 | 1516.00 |
| GlaxoSmithKline Pharmaceuticals | 2657.80 | (-)3.40 | 2719.40 | 2609.30 |
| Glenmark Pharmaceuticals | 1405.15 | 0.10 | 1432.40 | 1385.00 |
| Granules India | 470.65 | (-)4.60 | 483.60 | 463.60 |
| Ipca Laboratories | 1299.30 | (-)2.50 | 1356.80 | 1264.50 |
| Laurus Labs | 574.05 | 0.60 | 590.50 | 564.00 |
| Lupin | 1968.45 | (-)3.00 | 2000.10 | 1934.70 |
| Natco Pharma | 780.85 | (-)5.40 | 803.00 | 768.80 |
| Pfizer | 4065.35 | (-)1.80 | 4128.60 | 4003.60 |
| Sanofi India | 5587.15 | 1.90 | 5674.30 | 5459.70 |
| Sun Pharmaceutical Industries | 1683.45 | 4.60 | 1701.70 | 1654.30 |
| Torrent Pharmaceuticals | 3056.05 | (-)0.60 | 3133.30 | 3009.20 |
| Zydus Lifesciences | 883.10 | (-)2.00 | 904.00 | 869.60 |
| Nifty Pharma | 20386.85 | 0.00 | 20591.50 | 20202.80 |
| Nifty 50 | 22397.20 | (-)0.70 | 22624.90 | 22263.50 |
| S&P Bse Sensex | 73828.91 | (-)0.70 | 74630.70 | 73369.70 |
End
Reported by Alina Geogy
Edited by Ashish Shirke
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