Budget 2017: What may be in store for Cipla stock

A look at how the stock has moved in the past year and what it may get from Budget 2017

Stocks of pharmaceutical companies are largely less volatile around the Budget but Cipla, having more domestic exposure, has seen volatility. Increase in health care expenditure (low at 

1.5 per cent of total expenditure) and boost to research and development (R&D) activity via incentives are among key expectations. In the previous Budget, Customs and excise duties remained unchanged but expectations on boosting infrastructure for the industry were not met.

Current Budget: While R&D incentives and rise in health expenditure will be looked at, there are high expectations of a cut in the minimum alternate tax currently levied on Special Economic Zones. Expectations on removal of excise duty disparity between formulations and active pharmaceutical ingredients could also keep volatility high.

Note: Net sales and net profit are for trailing 12 months ended September 2016; Price, market cap and PE ratio are as on Jan 25, 2017; sales, profit and market cap figures are rounded off. Source Capitaline/Exchange

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