Shares of pharmaceutical companies were on a roll on Friday, with the S&P BSE Healthcare index surging over 3 per cent to hit a record on the back of positive news flow.
Twelve stocks, including Dr Reddy’s Laboratories, Laurus Labs, Cipla, Biocon, Divi’s Laboratories, FDC, Granules India and Apollo Hospitals scaled their respective records, while eight other stocks — Lupin, Cadila Healthcare, Natco Pharma, Stride Pharma, Neuland Labs, Lincoln Pharma and Hikal — hit their respective 52-week highs on the BSE.
The S&P BSE Healthcare index, the top gainer among sectoral indices, rose 3.5 per cent to close at 20,405 points, as compared to 0.34 per cent decline in the Sensex. The healthcare index hit high of 20,294 in intra-day.
In a positive development for Lupin and Cipla, Perrigo has announced a voluntary recall of its albuterol sulphate inhalation aerosols in the US over concerns that some units may not dispense properly due to clogging issues. Shares of Cipla closed 7 per cent higher, after touching intra-day high of Rs 819, while Lupin ended 5 per cent higher, after rallying 8 per cent intra-day.
Dr Reddy’s reached a record of Rs 5,497, a 14 per cent rise intra-day, after it entered a settlement agreement with Celgene Corp. The stock settled 10 per cent higher. It has rallied 22 per cent in past four trading sessions after the company and the Russian Direct Investment Fund (RDIF) agreed to cooperate on clinical trials and distribution of the Sputnik V vaccine candidate.
“Strong quarterly results, rising US Food and Drug Administration (USFDA) approval and favourable government policies have boosted pharma stocks. Export oriented companies witnessed increased demand for their products across markets. The ANDA approvals have been better than previous quarters, implying smooth functioning of the USFDA. Further we expect steps taken by the government to be positive for some API players,” said Hemang Jani, head of equity strategy, broking & distribution, Motilal Oswal Financial Services.