Pharma space will continue to do well: Karvy Private Wealth

In a chat with ET Now, Varun Goel, Head of PMS, Karvy Private Wealth, shares his views on Pharma space.

ET Now: Are you a bit surprised with the strength in pharma stocks? Most of the pharma stocks, at least the large ones, they are up about 40% to 50% this year. What is fuelling and driving Indian pharma stocks?

Varun Goel: The pharma space has been a secular growth story in the last several years now. One big space that has opened up with research and manufacturing space. So, companies which are geared towards that segment have seen very robust set of earnings, expansion in margins and definitely the rupee weakness of more than 20% in last one year has definitely helped companies geared towards export earnings. If we look at the domestic formulations business also, most of the companies in the listed space have shown almost 15% to 20% revenue growth on a consistent basis for quite sometime. So in a time when corporate earnings have been under lot of pressure, there have been concerns about margins, there have been concerns about currency, pharma sector clearly stands out and an oasis of growth. We continue to like this space and we believe that this space will continue to do well. Probably, pharma space is going to be one of the leaders as far as earnings are concerned in quarter one for this year.