Sectoral safety, leverage to rupee attracts investor interest in Pharma space: Manishi Raychaudhuri, BNP Paribas Securities

In a chat with ET Now, Manishi Raychaudhuri, MD & HoR, BNP Paribas Securities, shares his views on the current outlook of Pharma space. Excerpts:

ET Now: The US FDA issue is a big concern for almost every Indian pharma company. What’s your take?

Manishi Raychaudhuri: There are some of the companies who have possibly gone ahead and addressed the US FDA issue much better than what some of the other companies have. The trick for investors would be to concentrate on the companies of the former kind. Sun Pharma clearly fits into that category; hence we have it and some others in our model portfolio.

We have a neutral stance on the pharmaceutical space right now. In the first half of the year, we were clearly more bullish and overweight on the sector. However, we have reduced that weight partly because the stocks have done very well. Sun Pharma is at about 35-40 per cent up this year and a combination of valuations and the risks lead us to trim our positions slightly.

However, at the same time, given the relative safety that the sector provides and given the positive leverage to the rupee, it will continue to attract investor interest in the near term.