“Companies like Sun Pharma, Dr Reddys have made huge changes in their working style which is now playing out, that is why from here onwards we believe that earning momentum will be there for all these stocks. Regulatory overhang will always be there, that is part and parcel of pharma business that will always be there.”
Between 2005 to 2015, the pharma sector was one of the best performing sectors with stocks creating big wealth for the shareholders. Then came a spate of US FDA inspections and observation and a number of companies witnessed a sharp decline in performance. Over the next few years, stocks underperformed as companies went into introspection and course correction. Some of them have been able to make a comeback both in terms of operations and product portfolio. While there are some risks present in the system but given the fact they have come into under owned category, any positive news may have higher positive impact.
There was a time when having MNC stock was a must have in one s portfolio. They reason, they were very liberal at giving bonuses, dividend payments were good and given the fact some of them actually owned the best of the brands, they had seen a secular growth, which meant they were also able to deliver decent returns to shareholders. After the IT bull of 2000, as a new set of Indian companies took the centerstage, a number of MNCs stocks lost their shine at least on the street. Will they ever again get the tag of “ a must have” in one s portfolio ?. We take a look at 5 MNC pharma companies.
“We believe that Ciplas Pithampur facility was inspected in February and post that, they got an OAI in August and post that, it has escalated to a warning letter. We believe that it is unlikely that this will escalate further to import alerts, though this may take some time to resolve.”
“We are very clearly placed on companies which have got international exposure as far as pharmaceutical is concerned. Real estate continues to be very exciting and we are playing the entire real estate and building materials theme with stocks across sectors. We own cement and building material companies as well as select real estate.”