The Nifty Pharma has been one of the best performing indices in 2020 gaining around 50 percent and pharmaceutical stocks gaining anywhere between 30 percent and 100 percent since March 2020.
One of the reasons the pharmaceutical stocks have gained is because they benefitted from opportunities from the COVID-19 such as development, repurposing, and the sale of the COVID-19 drugs, R&D on the vaccine, and fast-tracking of API orders.
Divis Laboratories is a bellwether in terms of API sales, said Anmol Ganjoo of JM Financial Institutional Securities.
“It has been a big beneficiary of the COVID-related disruptions and the order flow that flowed in from the global pharmaceutical supply chain. This is a bellwether which will continue to do well through cycles. The best advantage that Divis offers from an investment standpoint is the fact that across cycles it has improved its return metrics, something that we have seen again. But it is not unfair to assume that as we speak things might be marginally ahead of themselves,” he said in an interview with CNBC-TV18.
JM Financial has a buy on several pharma stocks such as Sun Pharmaceutical, Cipla, Cadila Healthcare, Strides Pharma, as well as Jubilant Life Sciences.
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