Sun Pharma and Cipla are better positioned for fresh investments than some of the recent pharma outperformers, according to Deven Choksey, Managing Director at DRChoksey Finserv. He believes large complex generic drugmakers are well placed to benefit from export opportunities and upcoming patent expiries over the next few years.
Choksey said investors should look beyond stocks that have already rallied sharply and instead focus on companies with stronger earnings visibility. He also remained constructive on Indian IT companies, saying AI-led demand could support growth, while advising investors to wait for meaningful corrections before buying jewellery retailers.
Choksey said Divi's Laboratories and Laurus Labs remain part of his portfolio but are not attractive fresh buying opportunities after their recent run-up."We continue to hold them. We find them a bit expensive at least at this point of time. Maybe a deep correction would be a meaningful choice to buy into."Instead, he prefers larger complex generic drugmakers such as Sun Pharma, Cipla and Dr Reddy's Laboratories."Among the fresh buys...
Sun Pharma, Cipla and Dr Reddy's are relatively better positioned at this point of time."According to Choksey, these companies are preparing for opportunities arising from exports and upcoming off-patent drugs over the next three to five years. He said their product pipelines could support earnings growth, adding that 15-20% kind of upside cannot be ruled out over the medium term.
On the jewellery sector, Choksey said Titan and Kalyan Jewellers remain quality businesses, but current valuations leave little room for fresh buying. Instead, he believes suppliers to organised jewellery retailers could offer better opportunities. He pointed to Shanti Gold, a recent listing, as a company worth tracking because it supplies larger jewellery retailers, though he clarified that his firm has not taken any investment position in the stock.
Choksey also remained positive on Indian IT companies despite concerns around rapid developments in artificial intelligence. He said Indian technology firms are beneficiaries of AI adoption because they help enterprises deploy new technologies. "Indian IT companies are relatively better placed because we are adapters."He added that largecap IT companies are seeing increasing order inflows from AI-related projects and should deliver better performance going forward.
He also likes mid-tier engineering and R&D companies, although he advised investors to wait for market corrections before accumulating those stocks. For the full interview, watch the accompanying videoCatch all the latest updates from the stock market here