Just before the whole market was consumed by the PSU rally, one sector that came into the limelight after many years of underperformance was the Indian pharma companies, yes they are very different in every sense from MNC pharma. During the PSU rally, these pharma stocks have been consolidating, however, in the last few days, some of them have once again started reacting to positive developments in the individual company indicating that there is money on the sideline that is ready to come into these stocks. Sectors like pharma which have seen a very long phase of business remodelling and valuation readjustment need to be brought back on the watch list. It might be too early to call, but if a re-rating gets momentum once again then they might be better candidates for volatile markets.
N Jayakumar highlights the need to view the market differently due to the influx of younger, retail, aggressive investors. He suggests finding comfort in private sector banks, pharma stocks, OMCs, and power sectors. The market should shed historical baggage and focus on future potential. He said: "You need to learn from the past but you cannot ignore the present and therein lies the truth."
Sumeet Bagadia of Choice Broking has chosen Cipla as his ‘Valentine s Day 2024 Pick’. Bagadia has recommended a ‘Buy’ on the pharma stock at ₹1,450 and up to ₹1,415 for a target price of ₹1,600 to ₹1,660.
The better way to play pharma is Sun Pharma and Aurobindo which we like. The other trend is domestic outlook for the growth for pharma. The proxy there is Torrent and Ajanta.Railways have new avenues of growth and strong momentum. Medium-term targets and government support improve growth prospects. Larger railway stocks like Concor, Kalpataru, and KEC are attractive due to their involvement in electrification lines. Having said that, some of the mid and smallcaps have run up much sharper.
Piramal Pharma reassured stakeholders that the observations were classified under the Voluntary Action Indicated (VAI) category and did not involve issues related to data integrity