Indian pharma cos could see sustained margin expansion in near term - Bernstein

Alkem Laboratories

24/11/2023 07:02

** Profit margins in Indian pharma companies will likely
remain strong in near term, according to Bernstein
    ** Sees softer price erosion in the U.S., improved active
pharma ingredients (API) prices as key tailwinds for margins
    ** Brokerage retains "outperform" rating on Cipla  CIPL.NS  
due to strength in U.S. base portfolio, Aurobindo Pharma
 ARBN.NS  on low price erosion and strong U.S. demand, Biocon
 BION.NS  and Gland Pharma  GLAD.NS  due to attractive
valuations
    ** Bernstein remains less constructive on Dr Reddy's
Laboratories  REDY.NS , Sun Pharmaceutical Industries  SUN.NS ,
Alkem Laboratories  ALKE.NS  due to lack of near-term catalysts
for growth
    ** Also sees room for corrections in Lupin  LUPN.NS , Divi's
Laboratories  DIVI.NS  due to high valuations
    ** Adds growth recovery in the U.S. will aid Indian pharma
companies, expects domestic demand revival in December quarter
    ** Pharma index  .NIPHARM  up 27% in 2023 so far,
outperforming 9.4% rise in Nifty 50 

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India's pharma stocks outperform benchmark Nifty in 2023    https://tmsnrt.rs/3uogpWO
Bernstein's expectations for December quarter    https://tmsnrt.rs/47qdtb2
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 (Reporting by Bharath Rajeswaran in Bengaluru)
 ((bharath.rajeswaran@thomsonreuters.com; +91 9769003463;))