2 Bluechip Pharma Stocks At 52-Week Lows, Should You Buy?

It's been a stock pickers market over the last few months, with some sectors and some stocks declining. For example, we are seeing MNC stocks which were once the darling of the markets, falling. On the other hand, we are seeing buying interest in Adani group stocks and Reliance. Investors are increasingly becoming choosy. Here are 2 bluechip pharma stocks, which could be good bets at the current levels.

Sanofi India

This stock has plunged from 52-week highs of Rs 9285 to the current market price of Rs 7000. The company is a bluechip pharma company and a subsidiary of french pharma giant Sanofi.

Sanofi, one of the world's leading healthcare companies, and its 100% subsidiary - Hoechst GmbH, are the major shareholders of Sanofi India Limited and together hold 60.4% of its paid-up share capital. Sanofi India has a solid track record of dividends and profitability.

Strong on dividends

For the year 2021, the company declared a dividend of Rs 490 per share. The company has for the last many years has been declaring special and final dividends. Recently, broking firm Sharekhan set a price target of Rs 9250 on the stock.

Divestment of Nutraceuticals business as well as slow moving brands, to remove a drag on the company's growth and would facilitate enhanced focus on key growth areas - anti diabetes, cardiac.

"Sanofi has divested its slow-moving business and has laid its focus on the anti-diabetic's segment for growth and is looking to enhance its geographical penetration. Moreover, a chronic-heavy portfolio, strong performance of top brands, and a dominant share in their respective categories provide comfort on growth ahead," the brokerage had said.

Sanofi India: Low on valuations

On a trailing EPS basis, the stock of Sanofi India is trading at a p/e of just 17 times. The stock recently went ex dividend. The shares of the company have fallen from levels of Rs 9200 to about Rs 7000 currently, which makes it attractive.

We believe that at 17 times p/e, there is a good scope for further appreciation in the stock. Long-term investors can buy the stock for a steady dividend yield and profits going ahead.

Ajanta Pharma

This is another pharma stock that is close to its 52-week low. Ajanta Pharma is a specialty pharmaceutical company engaged in development, manufacturing and marketing of quality finished dosages. Its business includes Branded Generics in emerging markets of Asia and Africa, Generics in the developed markets of USA and Institution sales. Recently, brokerage firm Motilal Oswal had given a buy call on the stock with a price target of Rs 2,500.

"We continue to value Ajanta Pharma at 25x 12M forward earnings to arrive at our Target Price of Rs 2,500. We remain positive on the company on the back of its strong brand franchise in DF/Asia/Africa; robust prospects for the US Generics segment; and ) superior profitability and return ratios," the brokerage had said.

The stock was last seen trading at Rs 1,771 as against the 52-week high price of Rs 2435. The stock is a good bet for those looking at long-term investment. Buy the stock around the Rs 7000 levels.