Nifty Pharma – Nifty Pharma Index

The table below shows the Nifty Pharma Index based on the Highest Market Capitalization & 1-Year Return.

Introduction To Nifty Pharma Stocks

Sun Pharmaceutical Industries Ltd

The Market Cap of Sun Pharmaceutical Industries Ltd is Rs. 432,132.22 crores. The stock’s monthly return is -0.48%. Its one-year return is 43.77%. The stock is currently 8.84% away from its 52-week high.

Founded in 1983, Sun Pharma began with a focus on psychiatry products, gradually expanding into cardiology by 1988.

Over the years, it has become one of the largest generic pharmaceutical companies globally, offering a diverse range of specialty and generic medicines.

Divi’s Laboratories Ltd

The Market Cap of Divi’s Laboratories Ltd is Rs. 155,292.48 crores. The stock’s monthly return is 2.59%. Its one-year return is 57.55%. The stock is currently 7.45% away from its 52-week high.

Established in 1990, Divi’s Laboratories is a leading manufacturer of Active Pharmaceutical Ingredients (APIs), serving over 95 countries.

The company specializes in generic APIs, nutraceutical ingredients, and custom synthesis of APIs, catering to big pharma throughout the product lifecycle.

Cipla Ltd

The Market Cap of Cipla Ltd is Rs. 118,913.09 crores. The stock’s monthly return is -2.97%. Its one-year return is 21.01%. The stock is currently 15.6% away from its 52-week high.

Cipla Ltd, established in 1935, is an Indian multinational pharmaceutical company renowned for its pioneering role in producing low-cost anti-AIDS medications.

The company focuses on developing medicines to treat respiratory, cardiovascular, arthritis, diabetes, and other medical conditions, with a strong emphasis on accessibility and affordability.

Mankind Pharma Ltd

The Market Cap of Mankind Pharma Ltd is Rs. 112,423.79 crores. The stock’s monthly return is 1.64%. Its one-year return is 45.42%. The stock is currently 2.43% away from its 52-week high.

Founded in 1995, Mankind Pharma has rapidly grown to become one of India’s leading pharmaceutical companies, focusing on affordable and quality healthcare products.

The company’s product range spans antibiotics, antifungals, gastrointestinal, cardiovascular, dermal, and erectile dysfunction medications, emphasizing accessibility for the masses.

Dr Reddy’s Laboratories Ltd

The Market Cap of Dr Reddy’s Laboratories Ltd is Rs. 106,250.04 crores. The stock’s monthly return is 3.46%. Its one-year return is 14.06%. The stock is currently 11.45% away from its 52-week high.

Established in 1984, Dr. Reddy’s Laboratories is a multinational pharmaceutical company based in India, committed to providing affordable and innovative medicines.

The company operates in markets across the globe, offering a portfolio that includes generic medications, active pharmaceutical ingredients, biosimilars, and differentiated formulations.

Zydus Lifesciences Ltd

The Market Cap of Zydus Lifesciences Ltd is Rs. 98,565.65 crores. The stock’s monthly return is 0.64%. Its one-year return is 43.92%. The stock is currently 35.19% away from its 52-week high.

Zydus Lifesciences, formerly known as Cadila Healthcare, is an Indian pharmaceutical company founded in 1952, known for its wide range of healthcare products.

The company engages in the development and manufacturing of pharmaceuticals, diagnostics, herbal products, skin care products, and other over-the-counter products, serving markets globally.

Lupin Ltd

The Market Cap of Lupin Ltd is Rs. 95,760.43 crores. The stock’s monthly return is 2.35%. Its one-year return is 66.89%. The stock is currently 10.14% away from its 52-week high.

Founded in 1968, Lupin Ltd is a transnational pharmaceutical company based in Mumbai, India, recognized for its significant contributions to the generic pharmaceuticals market.

The company’s product portfolio includes formulations and active pharmaceutical ingredients in cardiovascular, diabetology, asthma, pediatric, CNS, GI, anti-infective, and NSAID therapy areas.

Aurobindo Pharma Ltd

The Market Cap of Aurobindo Pharma Ltd is Rs. 72,457.91 crores. The stock’s monthly return is -2.51%. Its one-year return is 22.05%. The stock is currently 27.61% away from its 52-week high.

Established in 1986, Aurobindo Pharma is an Indian multinational pharmaceutical company that commenced operations in 1988–89 with a single unit manufacturing semi-synthetic penicillin.

The company has since expanded its product range to include a wide spectrum of therapeutic areas, exporting to over 150 countries with a strong presence in the USA and Europe.

Alkem Laboratories Ltd

The Market Cap of Alkem Laboratories Ltd is Rs. 65,680.04 crores. The stock’s monthly return is -3.62%. Its one-year return is 12.03%. The stock is currently 17.23% away from its 52-week high.

Founded in 1973, Alkem Laboratories is a leading Indian pharmaceutical company engaged in the development, manufacture, and sale of pharmaceutical and nutraceutical products.

The company’s diverse portfolio includes branded generics, generic drugs, active pharmaceutical ingredients, and nutraceuticals, with a significant presence in both domestic and international markets.

Abbott India Ltd

The Market Cap of Abbott India Ltd is Rs. 59,730.94 crores. The stock’s monthly return is 2.01%. Its one-year return is 23.39%. The stock is currently 8.58% away from its 52-week high.

Abbott India, a subsidiary of Abbott, has been delivering healthcare solutions for over 75 years. It focuses on therapeutic areas such as diabetes, cardiovascular, gastrointestinal, and women’s health.

The company emphasizes innovation and research, offering high-quality medicines and nutrition products. Abbott India’s commitment to health and wellness ensures a better quality of life for patients.

What is the Nifty Pharma Index?

The Nifty Pharma Index is a benchmark index that tracks the performance of pharmaceutical and healthcare companies listed on the National Stock Exchange (NSE) of India. It represents the pharmaceutical sector, which includes companies involved in the research, development, manufacturing, and marketing of drugs and medical products.

This index serves as a crucial indicator for investors and analysts to gauge the overall health and trends in the pharmaceutical sector. It includes stocks of leading pharmaceutical companies, providing a comprehensive view of the industry’s performance.

The Nifty Pharma Index is designed to reflect market movements and capture the capital market characteristics of the pharmaceutical sector. It’s widely used as a benchmark for mutual funds and exchange-traded funds (ETFs) focusing on the pharmaceutical sector.

Pharma Nifty Weightage

The Pharma Nifty Weightage refers to the proportion of each stock’s representation in the Nifty Pharma Index. These weightings are typically based on the free-float market capitalization of the constituent companies, reflecting their relative size and importance within the index.

Weightings are crucial as they determine how much each stock’s price movements affect the overall index performance. Companies with higher weightings have a more significant impact on the index’s value, while those with lower weightings have less influence.

The weightings are periodically reviewed and adjusted to ensure the index accurately represents the current market scenario. This rebalancing helps maintain the index’s relevance and efficiency in tracking the pharmaceutical sector’s performance over time.

Best Nifty Pharma Stocks Based On 1M Return

The table below shows the Best Nifty Pharma Stocks based on a 1-month return.

Nifty Pharma Stocks List Based On Dividend Yield

The table below shows the Nifty Pharma Stocks based on Dividend Yield.

How is the Nifty Pharma Index Value Calculated?

The Nifty Pharma Index value is calculated using the free-float market capitalization method. This method considers only the publicly traded shares of each company, excluding shares held by promoters or government entities. The index value reflects the total market value of all constituent stocks.

The calculation involves multiplying each stock’s price by its free-float shares and summing these values for all constituents. This total is then divided by a factor called the index divisor, which ensures continuity despite corporate actions like stock splits or dividends.

The index value is updated in real-time during trading hours, providing a continuous measure of the pharmaceutical sector’s performance. This calculation method ensures that larger companies have a greater influence on the index, reflecting their market importance.

How Stocks Are Selected for the Nifty Pharma Index?

Stocks for the Nifty Pharma Index are selected based on specific criteria set by the National Stock Exchange (NSE). The primary requirement is that the company must be classified under the pharmaceutical sector. Additionally, the stock should have a minimum float-adjusted market capitalization and liquidity.

The selection process also considers factors such as trading frequency and average impact cost. Companies must have a track record of consistent performance and should be among the largest in the pharmaceutical sector by market capitalization. The index is periodically reviewed to ensure it remains representative.

Stocks that no longer meet the criteria may be removed and replaced with new ones that qualify. This dynamic selection process helps maintain the index’s relevance and ensures it accurately represents the current state of the pharmaceutical sector.

History of the Nifty Pharma

The Nifty Pharma Index was launched by the National Stock Exchange (NSE) of India to provide a benchmark for the performance of the pharmaceutical sector in India. It was created to track the performance of pharmaceutical and healthcare companies listed on the NSE.

Since its inception, the index has undergone several changes to reflect the evolving landscape of the pharmaceutical sector in India. These changes include additions and deletions of companies based on their market capitalization and liquidity, as well as adjustments to the weightings of constituent stocks.

The Nifty Pharma index has played a crucial role in tracking the growth of India’s pharmaceutical sector. It has become an important tool for investors, fund managers, and analysts to gauge the performance of pharmaceutical stocks and make informed investment decisions.

Key Factors of Nifty Pharma Index Performance

The main factors influencing the Nifty Pharma Index performance include the regulatory environment, research and development success, global demand, pricing pressures, and company-specific factors. These elements collectively shape the index’s movements and overall trend.

• Regulatory Environment: Changes in drug approval processes and healthcare policies can significantly impact pharmaceutical companies’ operations and profitability.
• Research and Development: Success in developing new drugs and therapies drives growth and stock performance for pharmaceutical companies.
• Global Demand: Increasing healthcare needs worldwide, especially in emerging markets, affect the demand for pharmaceutical products.
• Pricing Pressures: Competition and government regulations on drug pricing can impact profit margins and stock performance.
• Company-Specific Factors: Individual company performances, including product launches, patent expiries, and mergers and acquisitions, affect their stock prices and the index.

Benefits of Investing in the Nifty Pharma

The main benefits of investing in Nifty Pharma include exposure to India’s growing healthcare sector, the potential for steady returns, and diversification within a defensive industry. These advantages make it an attractive option for many investors.

• Healthcare Sector Exposure: Provides investors access to India’s expanding healthcare and pharmaceutical market.
• Steady Returns Potential: Pharmaceutical stocks often offer stable returns due to consistent demand for healthcare products.
• Defensive Nature: The healthcare sector is generally less affected by economic downturns, providing portfolio stability.
• Innovation Potential: Exposure to companies at the forefront of medical research and development.
• Global Market Access: Many Indian pharmaceutical companies have international operations, offering global market exposure.

Risks of Investing in the Nifty Pharma Stocks 

The main risks of investing in Nifty Pharma stocks include regulatory challenges, research and development failures, patent expirations, and pricing pressures. These factors can potentially impact the performance and returns of pharmaceutical sector investments.

• Regulatory Risks: Stringent regulations and changes in drug approval processes can affect product launches and profitability.
• R&D Failures: Unsuccessful drug trials or delays in product development can significantly impact stock prices.
• Patent Expirations: Loss of patent protection can lead to increased competition from generic drugs, affecting revenues.
• Pricing Pressures: Government interventions and market competition can squeeze profit margins.
• Legal Liabilities: Pharmaceutical companies may face lawsuits related to product safety, potentially impacting financial performance.

How To Invest in Nifty Pharma Stocks?

Investing in Nifty Pharma stocks can be done through various methods. The most direct approach is to buy individual stocks of companies included in the Nifty Pharma index through a stockbroker like Alice Blue. This allows investors to select specific companies they believe will perform well.

Another popular method is investing in mutual funds or Exchange Traded Funds (ETFs) that track the Nifty Pharma index. These funds provide diversified exposure to the pharmaceutical sector without the need to manage individual stocks. They offer professional management and automatic rebalancing.

For those seeking a more passive approach, index funds replicating the Nifty Pharma are available. These funds aim to match the index’s performance by holding the same stocks in similar proportions, offering a cost-effective way to invest in the entire pharmaceutical sector.

What Are The Tax Implications Of Investing In Nifty Pharma Index?

The tax implications of investing in the Nifty Pharma Index depend on the investment method and holding period. For direct stock investments, short-term capital gains (held for less than one year) are taxed at 15%, while long-term gains (over one year) above ₹1 lakh are taxed at 10%.

For investments through mutual funds or ETFs, similar rules apply. However, equity-oriented funds held for over a year benefit from indexation, potentially reducing the tax burden. Dividends from pharmaceutical stocks or funds are taxable at the investor’s applicable income tax slab rate.

It’s important to note that tax laws can change, and individual circumstances may vary. Consulting with a tax professional is advisable to understand the specific tax implications based on your investment strategy and overall financial situation.

Future of Nifty Pharma

The future of Nifty Pharma looks promising, driven by India’s growing healthcare needs, increasing life expectancy, and rising income levels. The pharmaceutical sector is expected to benefit from government initiatives to improve healthcare accessibility and affordability across the country.

Technological advancements in drug discovery and development, along with a focus on personalized medicine and biotechnology, are likely to shape the sector’s future. Indian pharmaceutical companies are increasingly investing in research and development to create innovative therapies and expand their global presence.

However, challenges such as pricing pressures, regulatory scrutiny, and competition from generic drugs may impact the sector. Companies that successfully adapt to these changes, focus on innovation, and maintain quality standards, are likely to drive the index’s future performance..

FAQs – Nifty Pharma Stocks

We hope you’re clear on the topic, but there’s more to explore in stocks, commodities, mutual funds, and related areas. Here are important topics to learn about.

Disclaimer: The above article is written for educational purposes, and the companies’ data mentioned in the article may change with respect to time. The securities quoted are exemplary and are not recommendatory.