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Stocks of major pharmaceutical companies, most of which ended down yesterday, are expected to trade flat with a negative bias next week. Some analysts believe that the stocks may not gain substantially next week on account of profit booking in the pharmaceutical sector, while others say it could happen for lack of any trigger. We would be particularly watching stocks of Ranbaxy Laboratories Ltd, Lupin Ltd and Aurobindo Pharma Ltd. Ranbaxy and Lupin have very important levels of 480 rupees and 930 rupees, respectively, to cross, failing which they will be seen as negative. The Foreign Investment Promotion Board yesterday said it will mull the foreign direct investment proposals of Lupin and GlaxoSmithKline Pte Ltd on Jan 10.
Following the news, stocks of both these companies gained yesterday. GlaxoSmithKline Pharmaceuticals Ltd's stocks could continue their upward run if the board approves its proposal. GSK Pharma's parent company had recently said it would increase its stake in the Indian arm through an open offer at a price of 3,100 rupees per share. Yesterday, GSK Pharma's stocks closed at 2,986.15 rupees on the National Stock Exchange. Aurobindo Pharma expecting the company's profit to be driven by higher margins in US revenues. Stocks of Cipla Ltd are seen as the weakest in the sector with those of Sun Pharmaceutical Industries Ltd not far behind. These stocks have been performing in a range and have not shown any signs of outperformance. Sun Pharma's stock has been trading in a narrow range for the past few months. It should be avoided.
Stocks of major pharmaceutical companies, most of which ended down yesterday, are expected to trade flat with a negative bias next week. Some analysts believe that the stocks may not gain substantially next week on account of profit booking in the pharmaceutical sector, while others say it could happen for lack of any trigger. We would be particularly watching stocks of Ranbaxy Laboratories Ltd, Lupin Ltd and Aurobindo Pharma Ltd. Ranbaxy and Lupin have very important levels of 480 rupees and 930 rupees, respectively, to cross, failing which they will be seen as negative. The Foreign Investment Promotion Board yesterday said it will mull the foreign direct investment proposals of Lupin and GlaxoSmithKline Pte Ltd on Jan 10.
Following the news, stocks of both these companies gained yesterday. GlaxoSmithKline Pharmaceuticals Ltd's stocks could continue their upward run if the board approves its proposal. GSK Pharma's parent company had recently said it would increase its stake in the Indian arm through an open offer at a price of 3,100 rupees per share. Yesterday, GSK Pharma's stocks closed at 2,986.15 rupees on the National Stock Exchange. Aurobindo Pharma expecting the company's profit to be driven by higher margins in US revenues. Stocks of Cipla Ltd are seen as the weakest in the sector with those of Sun Pharmaceutical Industries Ltd not far behind. These stocks have been performing in a range and have not shown any signs of outperformance. Sun Pharma's stock has been trading in a narrow range for the past few months. It should be avoided.
