Why Pharma stocks are going through a rough patch?
Over the last few months, Pharma companies in India are being haunted by the US FDA. From a stock market perspective, Indian pharma companies are intensely dependent on actions from the USFDA. After a series of poor performance against notifications from the USFDA, the pharma sector has shed significant amount of its market capitalisation though the Healthcare index at the BSE rose by about 3% YTD.
Stock market’s reaction
In less than a month Divi’s Laboratories came down from about Rs.800 on 20th March to Rs.650 on 13th April consequent to an import alert issued by the USFDA. The stock has[....]