Pharma Stocks: The third quarter results season is about to begin. The market will keep a special eye on the performance of the pharma sector. According to PHILIP CAPITAL, earnings growth of pharma companies can be 15 percent on annual basis. Pharma companies are likely to benefit from specialty products in the third quarter. Pharma sector will benefit from flu season in US, domestic growth and weak rupee.
How much growth is expected in the third quarter?
Philip Capital’s report said that in the third quarter, the growth in Divis Labs was 45 percent on an annual basis, Zydus Life was 28 percent on an annual basis, IPCA Labs was 4 percent, Lupine was 39 percent, Dr. Reddy’s was 15 percent, Sun Pharma was 13 percent. A growth of 03 percent can be seen in Cipla and 03 percent.
The brokerage says that Divi’s Labs will benefit from good product mix. Meanwhile, Zydus Life will benefit from the exclusive US launch of gMyrbetriq and domestic formulation growth. Whereas Ipca Lab results will be supported by low base and Unichem performance. At the same time, Lupine will get support from ramp-up, US generic pricing and better margins.
PHILIP CAPITAL is of the view that Dr Reddy’s stands to benefit from the Nicotinell acquisition and strong domestic performance. At the same time, Sun Pharma will benefit from US specialty portfolio and strong domestic growth. The brokerage says strong domestic growth will add stability to Cipla’s results.
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Growth triggers in pharma industry
Talking about the triggers of growth in the pharma industry, PHILIP CAPITAL says that this industry will see benefits from specialty products, exclusive drug launches, limited products with competition, acquisitions and partnerships.
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