Pharma Sector Update: Torrent Pharma, Cipla, Lupin to Alkem Labs - HDFC Securities highlights
HDFC Securities see several growth catalysts across key markets and product categories (inhalers, biosimilars, complex injectables) playing out over the next 2-3 years for Indian pharma companies. The investments made over the last few years leave them well placed to capitalise on these opportunities. With cost bases pruned and operating leverage benefits, the sector is poised to grow at 21% earnings CAGR and witness ROCE improvement of 430bps to 15% over FY20- 23e.
BSE Healthcare Index has outperformed Nifty by 47% in the past one year and trades at 29x 1-yr forward, 30% above its historical average and 22% premium to Nifty (vs. 10-yr average of 31%): Zee Business