2013 has been the wonderful year for Pharma stocks as most of the stocks moved up by 50-200 % in a very short time. Dollar maintaining above 60 is very good for pharma stocks. The US business of pharmaceutical companies is expected to see a growth of 28% YoY on the back of the approval of 18 new ANDAs in Q3FY2014. The performance of the domestic business is likely to improve in Q3FY2014 (a growth of 15%vs a 13% growth in Q2FY2014).
Lets checkout some of the stocks from this sector which still have the potential to do well.
1. JB Chemicals
JB Chemicals and Pharmaceuticals (JB Chemicals) is likely to see a 20.2% Y-o-Y rise in revenues to Rs 240 crore. The stock remained in a range of 60-90 for more than one and half year and is now trading in a perfect uptrend. Short to medium term investors can buy the stock on dips. 120 is good support for short term and stop loss can be kept below 120. The stock has the potential to touch 150/170/185 levels.
2. Dishman Pharma
11.5% year on year sales growth is expected from Dishman Pharma. The stock is trading in an uptrend currently at 103 the stock has the potential to test 118/130 levels . 93 is a good support for the stock
We expect an 18.8% rise in the revenues of Cipla to Rs2,412 crore in Q3 FY2014 on the back of a strong growth in the export business. Technically the stock is trading in a range of 370 and 450. The stock has the potential to touch 450 and 480 levels . 375 is a good support for the stock.
4. Divi’s Lab
We expect Divi’s Labs to report an 18.8% Y-o-Y rise in the net sale. The stock is in an uptrend 1200 is a good support possible target 1400
5. Glenmark Pharma
Glenmark has been a under performer in the pharma sector and it has not participated in the rally. The stock is expected to catch up. One can take position with stop loss of 485 for the targets of 550/600
6. Cadila Healthcare
The stock has give a breakout with strong volumes from the resistance of 820, which can now be used as stop loss for the target of 950/900