Positive for Dr Reddy’s in pharma sector: Mayuresh Joshi

In a chat with ET Now, Mayuresh Joshi, VP, Institution, Angel Broking, shares his views on pharma space.

ET Now: Pretty much everything has moved higher in pharmaceutical. What is it that you find value in still right now?

Mayuresh Joshi: Clearly from the large cap space, we are liking Dr Reddy’s. Though the stock has moved up substantially from the last time that we have spoken, we are still feeling there is some amount of gap left.

Clearly, the kind of space and the products that Dr Reddy’s has got that would augur well for the company, 70 products in the pipeline, 9 FDFs, would definitely augur well. Though the results were a little bit below expectations where the profits came in at Rs 550 crores, our take is that a substantial R&D spend of around 8% to 9% of its top line, capex of almost Rs 900 to Rs 1000 crores would hold the company in good momentum.

Incidentally from the midcap pharma space, Dishman Pharma is what we are liking. The stock has disappointed in terms of EBITDA margins in the quarter gone by.