Frontline
pharmaceutical stocks are likely to move in a narrow range with some
stockspecific movement
based on Oct-Dec earnings of the companies next week. The only outperformers
in the rangebound pharmaceutical space could be Cadila Healthcare and Divi's
Laboratories. Cadila gave a good upward rally this week and will continue if it breaks
an important resistance of 920 rupees, which is highly likely to happen. Dr Reddy's
Laboratories Ltd and Cipla Ltd will report their earnings for the quarter
ending December
on Tuesday and Wednesday, respectively. Hyderabad-based
Dr Reddy's Laboratories is estimated to post a 51% on-year rise in its net
profit to 5.48 bln rupees during Oct-Dec. The company (Dr Reddy's) is expected
to see
strong traction in its Indian and Russian formulation businesses as well. For
Cipla, we expects
strong growth in export formulations led by Africa, improved traction in US and better
on-year currency realisations. The company is seen posting an Oct-Dec net
profit of
3.86 bln rupees, up 11% on-year. Mumbai-based
drugmaker Wockhardt Ltd will post its Oct-Dec results on Sunday and Anand
Rathi Stocks and we expects the company to post a net profit of 986 mln rupees, down
77% year-on-year following its issues with drug regulators abroad. Aurobindo Pharma
Ltd yesterday reported a 355% on-year rise in its Oct-Dec net profit and its stocks
hit lifetime high intraday. However, we sees some correction in the company's stocks
due to profit booking next week. Other pharmaceutical companies to post their Oct-Dec
earnings next week include Orchid Chemicals and Pharmaceuticals Ltd, Natco Pharma
Ltd, Panacea Biotec Ltd, Elder Pharmaceuticals Ltd, Dishman Pharmaceuticals and
Chemicals Ltd and Bafna Pharmaceuticals Ltd.
