Pharma and chemicals stocks took the driver’s seat in the domestic equity market’s rebound from the Covid-19 disruption.               

Data shows some 42 stocks from these sectors have more than doubled investors’ money since the beginning of this calendar year.

Chart topper Venus Remedies has rallied the most at 546 per cent, followed by Aarti Drugs (up 382 per cent), Mangalam Drugs (375 per cent), IOL Chemicals NSE 0.78 % (up 352 per cent) and Bharat Immunological & Biologicals (up 328 per cent).

Investors’ affection for these sectors is still visible in the market, which has since lost the momentum to a great extent. And the enthusiasm has had a rub-off even on the primary market, where the initial public offering of Chemcon Speciality Chemicals got subscribed over five times on the first day of issue on September 21.

Several top portfolio managers on Dalal Street, such as Marathon Trends and Valcreate Investment Managers, have top pharmaceutical stocks among their top holdings.

Analysts says a couple of factors are going in favour of these sectors, and the trend may continue.

“The pharmaceuticals and chemicals spaces will continue to show decent growth in earnings in next three to four years. We see big opportunities for companies engaged in contract manufacturing and outsourcing. Speciality chemicals will also benefit from the rising cost in China. In India, the cost mechanism also will ensure margins remain under control. We will continue to see stable growth in terms of businesses and these tailwinds will continue,” said Rajesh Pherwani, Founder and Portfolio Manager, Valcreate Investment Managers.                                                                                                                                      
Pherwani’s Life Sciences and Specialty Opportunities PMS strategy, which together have around 70 per cent exposure in chemicals and pharmaceuticals spaces, has delivered 30 per cent returns each to investors in last six months and 55 per cent in last one year.

Divi’s Laboratories, Abbott India, Sanofi India NSE 1.72 %, Aarti Industries NSE -1.96 % and Bayer CropScience are among the top holdings of his fund.