Regulatory issues should reduce going ahead for DRL: Edelweiss Sec

Pharma stocks have been on an upward trend. In an interview to CNBC-TV18, Deepak Malik, Pharma Analyst of Edelweiss Securities discussed what is happening in the sector.

Regulatory issues should reduce going ahead for Dr Reddy’s Laboratories (DRL). They got the warning letter for three of the plants, he said.

Last quarter was the worst quarter for the company. From here onwards things will start improving, they have already got positive response from United States Food and Drug Administration (USFDA). DRL has a very strong pipeline in FY18 and FY19. All these things augur well for the company, he added.

Earnings for DRL not entirely dependent on regulatory issues, said Malik.

On Divis Laboratories, he said, Divis should resolve the import alert that they got seven months back. Divis likely to solve import alert issues, he added.

Earnings will start coming in from FY19 for Divis, FY18 will remain a weak year for them because half year has already been passed, he further mentioned.

Ipca Laboratories has three plants under the import alert. Post Divis Laboratories’ news and the likely resolution of import alert, people are thinking that Ipca also will resolve those issues.

Looks like the worst is over for Ipca and from here onwards things will improve, he said.

For full interview, watch accompanying video...