IT, pharma firms emerge Samvat 2076 winners; Infy, Divi's Lab top gainers

Topics IT stocks | Pharma stocks | Samvat

People walk past the Bombay Stock Exchange (BSE) building in Mumbai. Photo: Reuters
The IT and pharmaceuticals sectors has emerged winners for the year gone by. The BSE Healthcare and BSE IT indices delivered returns of 53.7 per cent and 48.2 per cent, respectively, during Samvat 2076 — by far the highest compared to any other sector. 

In addition, the top gainers' list of Nifty50 firms is dominated by entities from these two industries — with Divi's Laboratories, Infosys, Dr Reddy's Laboratories, and Cipla topping the returns chart. Gains ranged from 62 per cent to 95 per cent. 

On the other hand, PSU stocks and banks have been laggards — with ONGC, Indian Oil, IndusInd Bank, and Coal India delivering the worst returns. 

IT stocks gained from the stay-at-home theme, while pharma shares got lapped up by the unprecedented global health care crisis. 

However, experts say returns from the IT and pharma sector could plateau. Credit Suisse, for instance, has cut its exposure to both these sectors. High valuations and a relatively muted growth forecast is the reason for the downgrading of IT stocks, while it sees ‘cyclical and structural’ challenges in the health care space. Nomura, too, has reduced our weight on IT and pharma.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel