Shares of a cutch of pharma and diagnostic companies rallied up to 8 percent on December 22 to hit their respective 52-week highs. The rise comes in the wake of a fresh spate of Covid cases. India recorded 640 Covid-19 infections by the new sub-variant called JN.1 on December 22, bringing the total active cases to 2,997.
The Nifty Pharma index surged over 1 percent to hit a 52-week high of 16,500.90 during the day.
The stock of Piramal Pharma zoomed over 8 percent to hit a 52-week high of Rs 140.20 on the BSE. It has surged 16 percent so far, largely in line with the benchmark Sensex. ICICI Securities has re-initiated coverage on the stock with a 'buy' rating and set the target price at Rs 180.
The brokerage expects a healthy project pipeline, better volumes and sales in its contract development and manufacturing organisation (CDMO) business over FY23-26.
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AstraZeneca Pharma shares also surged over 8 percent to a 52-week high of Rs 5,193.75. The rise comes a day after the company announced that it will launch Trastuzumab Deruxtecan, also known as Enhertu, which is used in the treatment of HER2-positive breast cancer, in January 2024.
Shares of JB Chemicals and Pharma soared around 7 percent to scale a 52-week high of Rs 1,608.90 on the NSE. Shares of Gland Pharma also rose over 5 percent to a 52-week high of Rs 1,948.00 on the NSE.
Divi's Laboratories, Natco Pharma, Glenmark Pharma and Dr Reddy's also gained up to 3 percent intraday. Except for GlaxoSmithKline Pharma, Pfizer, Alkem Laboratories and Aurobindo Pharma, all Nifty Pharma index constituents traded with gains.
The pharmaceutical industry has experienced a remarkable upswing in 2023 with the Nifty Pharma Index rising around 30 percent year-to-date, and more than 70 percent of pharma stocks have shown positive returns in this quarter alone.
"The pharma industry is one of the few defensive industries and investor interest in it is also rising, as concerns about Covid-19 gain momentum, " said Aamar Deo Singh, senior vice-president for research at Angel One.
Further, a diversification option into the pharma sector is also being looked at by the investor community at large, which is adding fuel to the rally, given that benchmark indices such as Nifty and Sensex are also trading at record levels, he told Moneycontrol.
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