Things are not going great in the healthcare industry and many domestic as well as international fund houses are cautioning that regulatory concerns still remain in the industry, and investors would be better off staying away. The BSE Healthcare Index has lost more than 10% of its value so far this year.At such a time, Abhay Laijawala, head of India Equities Research at Deutsche Bank picks Aurobindo Pharma as his preferred stock.
Aurobindo Pharma has returned 10% in the year so far, while the BSE Sensex is up by more than 18% since January. The stock has rallied in the last three months with returns of more than 25%. The stock was trading flat at Rs 736 on Thursday morning at NSE.
Another stock which is on the radar of the expert is Mahindra and Mahindra, which has lagged the Sensex by more than 4% in the year so far. The scrip has lost more than 2% of it’s value in the last one month. While the stock has returned 14% since January, the BSE Auto Index is up by more than 16%. The stock was trading flat at Rs 1,356 on Thursday morning.
Jubilant FoodWorks which has given more than 60% in the year so far is also one of the preferred picks of Deutsche Equities. The stock was trading at Rs 1,362.8 this morning. CLSA has revised it’s target on the stock to Rs 1,900 from its earlier target of Rs 1,600. Sudarshan Sukhani, a technical analyst with o2analytics.com shares CLSA’s viewpoint on the stock. He said, “For some reason people are eating more pizza, I have no idea, but the stock price is in a very strong momentum up move.So, at that point we want to take advantage of the strong momentum. It is a short term buy unlike Adani Ports, but Jubilant Foods is also a buying opportunity.”