Pharma stocks in limelight
Our Bureau (BusinessLine)
CHENNAI, Sept. 7
ARE pharmaceutical companies on the verge of a windfall because of imminent relaxation of price control regime? The uptrend in the share price of select pharmaceutical companies today hints at benefits that may accrue on the heels of relaxation of price control.
On a day when the market indices slipped, select pharmaceutical stocks saw concerted buying. Notable among them were E. Merck, Unichem Laboratories, Glaxo, Pfizer, Lupin Laboratories, Sun Pharma and IPCA. The common thread running through these companies is that they are expected to be major beneficiaries of any relaxation in the Drug Price Control Order (DPCO).
In the last Budget speech, the Finance Minister, Mr. Yashwant Sinha, indicated that the Government would take another look at the current DPCO. Following Mr. Sinha's statement, the industry was optimistic about a relaxation in the list of drugs under price control. Another development viewed positively by the industry was the appointment of a committee to examine the possible candidates for an over-the-counter (OTC) list of drugs. Both the moves are expected to boost the profit of select drug companies.
Positive developments in this context may spark a rally in the sector which is reeling under a slowdown in sales growth in the first quarter of the current year.
Among the major gainers on Bombay Stock Exchange today were E. Merck, which closed at Rs. 687.05 (+Rs. 50.20), Unichem Labs closed at Rs. 353.15 (+Rs. 26.15), IPCA ended the day at Rs. 163.85 (+Rs. 12.10) and Sun Pharma which finished the day's session at Rs. 776 (+Rs. 57.45). |
