We are moving on to the next sector which is our Pharma Sectors. In today’s article, we will cover the best low price, Pharma Stocks. Before jumping to the stocks, how the sector is performing and how it’s positioned for 2023?
India is the largest producer of generic drugs, affordable vaccines, and generic medications. In terms of volume, the Indian pharmaceutical industry stands third in the world and growing at a CAGR of 9.43% for a decade. Indian pharma companies supply 50% of global demand and of which 40% comes from the US and 25% from the UK economy. The country has a got pool of scientists and engineers with the potential to capture the global market in another decade’s time. There is nothing to wrong to say India is ” the pharmacy of the world” due to the cost loss and better quality medicine.
According to an Indian economic survey, the domestic market is expected to grow 3x in the next decade so we are eyeing to reach US$65 Billion by 2024. In terms of the global market, India is a significant player and meets 60% of global vaccine demand.
We could see the large inflow of FDI in this sector surpassing US$ 19.90 billion. Recently, Indian pharma companies Sun Pharma and SPARC got licenses for the commercialization of phenobarbital for injections in the US. If you look at the different companies involved in this sector they are trying to reach new highs through innovations.
When the wave comes, then it takes small objects along with it. Similarly, the pharma sector has seen a boom during the pandemic era so it has a given push to small players to flourish in the market. The key drivers noticeable high economic growth with an increasing no. of health insurance companies which thereby pushes expenditure on healthcare business and medicine in India. Our honorable finance minister Ms. Nirmala Sitharaman announced an additional expenditure of Rs.197k crore for the pharmaceutical PLI scheme in 13 key sectors by 2026.
Best Low-Price Pharma Stocks
Now let’s get into the main topic of the article, check out which are those low-price pharma stocks:
Marksans Pharma Ltd
Marksans Pharma is one of my favorite multi-bagger company which should be the pick if you want something at a cheap price and want to add to the pharma sector. The company has around 80 products in its portfolio ranging from pain management, anti-diabetic, cardiovascular system, cough & cold, etc. Marksans do business abroad through their subsidiaries like Bell healthcare, Nova Pharmaceuticals, and Time Cap labs. The current price of the share is Rs.67.45 and with a market cap of Rs 2718 Crore. PE Ratio is 13.86 and almost debt-free company. The company has delivered excellent profit growth of 83.7% CAGR over the last 5 Years. Have a decent promoter holding of 48.6^ with 5% share of FIIs/DIIs.
BDH Industries Ltd
BDH is a pharmaceutical company. It manufactures 200+ drugs like acaricide, analgesics, antiprotozoal, antiseptics, anticancer, antidiabetics, and various others. The major revenue of the company comes from exports which account for 53% and the rest accounts for domestic sales. The company has a market cap of Rs.86.4 crore and the current price of the share is Rs.150. It is a completely debt-free company and maintains a healthy dividend payout ratio of 27.2%. Promoter's holding stands at 49.66% and the rest is with the public. They have reduced their debtor's days by 20 days. Have registered compounded sales growth of 10% over the last 5 years.
Zim Laboratories Ltd
Zim Lab is also a good bet and holds a legacy of 40 years in the industry. The company generates 75% of its sales from the export market. Have a market cap of Rs.448 cr and a current stock price is Rs.91.8. PE ratio is 20.6. The company has reduced its debt considerably and expects to give quarter results. The only issue I could notice is promoter holding as low as 33.3% with low ROE of 6.04%.
Other than these three stocks you may consider Colinz Laboratories, Maker Laboratories, and Gujarat Themis Biosyn Ltd on a higher end. If you like to get it reviewed please drop me a note and I will with further analysis.