Pharma Stocks Outlook for the week - 12 to 16.12.2016
Pharma Stocks Outlook for the week - 12 to 16.12.2016
The shares of pharmaceutical companies are likely to be subdued next week, in line with the broad market, as
investors remain cautious ahead of the US Federal Reserve's monetary policy meeting. Globally, markets are
likely to remain volatile in the coming days, and though defensive sectors such as pharmaceuticals will be more
stable, they may feel the impact too. Though most market participants have factored in a rate hike of 25 basis
points by the US Fed, they expect a knee-jerk negative reaction in such a case.
All pharmaceutical stocks, except Glenmark Pharmaceuticals, look subdued on the charts. However, they may
see a rebound as most are trading near their support levels. This week, shares of India's largest drug maker
slumped 6.6%, as the US Food and Drug Administration issues a Form 483 to the company's Halol facility,
citing nine observations for not complying with good manufacturing practices. The unit is already reeling under
the impact of a warning letter it received last December.
We expect Halol clearance in FY2018 as a base case, but any delay will clearly have an impact on our estimates
given that our forecasts include $250 mn of new launches by SUNP in the US in FY2018.
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Pharma Stocks Outlook for the week - 12 to 16.12.2016
