Pharma Stocks Outlook: 30.07.2012 - 03.08.2012
The Reserve Bank of India's monetary policy Tuesday
and Apr-Jun earnings of companies are likely to provide direction to
pharmaceutical stocks next week. Traders are likely to be cautious and
invest in less risky stocks on Monday, ahead of the Jul 31 monetary policy
of the RBI. Being defensive in nature, pharmaceutical stocks are likely to
attract investors Monday. A majority expect the RBI governor to keep the
repo rate, at which it lends to banks under the liquidity adjustment
facility, unchanged at 8.0% in the first quarter review of the monetary
policy on Tuesday. Stocks of Cipla Ltd will be in focus as the company
announces its quarterly earnings on Tuesday. In Apr-Jun, the Mumbai-based
company's net profit is likely to rise 24% from a year ago to 3.13 bln
rupees. Revenues may rise 22% to 18.93 bln rupees, decent growth in Cipla's
domestic business, and higher realisation from exports because of the
depreciation of the rupee.
However, the stock along with stocks of Cadila
Healthcare may see some lows next week as the National Pharmaceutical
Pricing Authority turned down the companies' request to increase insulin
prices. Stocks of GlaxoSmithKline Pharmaceuticals and Pfizer Ltd are also
likely to fall next week as the NPPA has cut the prices of vitamin C drugs
ranging from 0.12% to 37.7% of the existing rates. Stocks of Dr Reddy's
Laboratories Ltd are seen gaining next week as the US Food and Drug
Administration has lifted the year-long import ban from the Mexican
intermediates and active pharmaceutical ingredients manufacturing unit of
the company. The company can now start importing products from the unit to
the US.
By RUPEE DESK [email protected]
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