Mutual Funds increased stake in 14 pharma stocks in Q4FY25; do you own any?

Analysts believe that pharma shares continue to see buying interest, given the inelastic demand for medicines; tariffs, if any could have minimal impact on the industry.

Shares of pharma sector companies continue to remain on investor’s radar as the sector awaits the anticipated US tariff announcements on pharma imports. While increasing tariffs by 10 per cent across-goods, the US President Donald Trump said that tariffs on pharma imports will be announced at a later date.  The US President stated that he would impose "major" tariffs on pharmaceuticals in the near future, a move that could end decades of low-cost global trade in medicines. However, recent reports suggest thae Donald Trump was open to offer some exemptions to his 10 per cent baseline tariff, to select selectors including auto ancillaries and electronics among others.  As the suspense over the US tariffs on the pharma industry continues, shares of pharmaceutical companies have recovered notable ground in the month of April thus far. As many as 82 pharma stocks outperformed the Nifty Pharma and Nifty Healthcare indices - gaining over 4 per cent; with the top 3 rallying more than 50 per cent. READ MORE  Meanwhile, as per the shareholding pattern at the end of March 2025 quarter domestic mutual funds (MFs) have increased stake in a total of 38 pharma and healthcare related stocks. Out of which, MFs increased stake in 14 pharma stocks by more than 10 per cent each.  Analysts believe that pharma as a sector is well-positioned to counter any potential impact of tariff hikes, as it can easily pass on the additional costs by hiking prices of the medicines.    Kranthi Bathini, Director-Equity strategy at WealthMills securities says that medicines have an inelastic demand, so even if there are tariffs imposed on the sector it could not have much impact on the industry in the longer-run.  Additionally, pharma as a sector has shown some signs of recovery in the last one year, after a prolonged period of under-performance in the preceding two years. At present levels, valuations look attractive for the pharma sector, hence it is attracting buying interest, Kranthi added.  Data from ACE Equity shows that MFs raised stake in Brooks Laboratories by 156 per cent, from 3.86 per cent at the end of December 2024 quarter to 9.9 per cent at the end of March 2025 quarter. Similarly, MFs increased stake in Onesource Speciality, Indegene and Zota Heath Care by 86.8 per cent, 57.9 per cent and 50 per cent, respectively. MFs now own up to 8.32 per cent, 2.65 per cent and 0.03 per cent, respectively, in each of the above mentioned companies. 

 

  Among prominent names, MFs raised shareholding in Granules India from 10.39 per cent to 11.57 per cent. In Dr. Reddy's Laboratories from 11.14 per cent to 12.89 per cent; Neuland Laboratories from 6.29 per cent to 7.43 per cent; Aarti Drugs from 7.78 per cent to 8.75 per cent and GlaxoSmithKline Pharma from 4.96 per cent to 5.17 per cent.    These apart, MFs have also hiked stake in other notable pharma companies such as - Marksans Pharma, Wockhardt, Cipla, Piramal Pharma, Glenmark Pharma, Zydus Lifesciences, Divi's Laboratories, Aurobindo Pharma, Biocon, Lupin and Pfizer by 3 - 7 per cent.  On the other hand, MFs have decreased holdings in Supriya Lifescience, Vimta Labs and Suven Life Sciences by over 100 per cent each. Strides Pharma, Emcure Pharmaceuticals, Laurus Labs, AstraZeneca Pharma, Concord Biotech, Gland Pharma, Unichem Laboratories and Mankind Pharma were among the prominent stocks wherein MFs stake has declined.