The big bull Rakesh Jhunjhunwala seems to be going against the tide, as he's betting heavily on the pharma sector.
At a time when market experts are cautioning investors to stay away from the pharmaceutical sector, ace investor Rakesh Jhunjhunwala’s wife has picked up 0.9% stake in Fortis Healthcare for an estimated Rs 60 crores, through an open market transaction. The shares were purchased at an average price of Rs 134.65 on Tuesday, valuing the transaction at Rs 60.59 crore, according to bulk deal data available with the National Stock Exchange (NSE).
Fortis Healthcare stocks have posted negative 20% returns in the year so far. In fact, the BSE Healthcare index has lost more than 13% in the last one month. On Wednesday morning the shares were trading up 5% at Rs 148.
In February 2015, Rakesh Jhunjhunwala had bought 34,85,075 shares of Fortis Healthcare, at Rs 119.35 apiece, for over Rs 41 crore through an open market deal.
Earlier, Rakesh Jhunjhunwala had increased his stake in Lupin Ltd to 1.76%, as on June end, according to the shareholding data filed by Lupin Ltd. The ace investor held 1.73% in the previous quarter Jan-Mar 17. In fact Lupin has posted results which were way below the street expectations. The pharmaceutical company reported a net profit drop just shy of 60% as compared to the corresponding period in the previous fiscal.
In light of the ongoing USFDA problems most of the major investment banks and brokerage houses have cautioned investors to stay away from the sector. According to CLSA, pharma space may bottom out in the next 6 months.
Just yesterday, Adrian Mowat, the chief emerging markets and Asian equity strategist at JP Morgan too concurred that there are concerns in the IT and pharma space. In conversation with CNBC TV18, he said, “We are underweight on IT and Healthcare.”
Mahesh Patil, Co-CIO Birla Sun Life Mutual Fund told CNBC TV18 recently that there is further downside in the Pharma sector. But for now, the big bull Rakesh Jhunjhunwala seems to be going against the tide.