Jefferies warns of H1 2026 to be weak for certain Pharma stocks — Check its top picks

Pharma stocks were trading largely lower on Thursday, January 8, as brokerage firm Jefferies said the first half of the calendar year 2026 is expected to be weak for firms with high exposure to the generic Revlimid drug.

Dr Reddy's Laboratories, Zydus Lifesciences and Cipla are to be the most affected due to the same, while Sun Pharma is likely to be the least affected, Jefferies said.

It added that domestic growth is expected to be high single digits, in-line with historical trends.

The brokerage also said high competitive intensity is expected during the semaglutide launch wave, which is expected between March-April 2026.

Jefferies recommendations

Mankind Pharma, Ajanta Pharma, Sun Pharma, Zydus Life are the top picks within the Pharma space highlighted by Jefferies, who sees upside potential between 23% to 32% on the stocks.

The brokerage has also upgraded its rating on Entero Healthcare to "buy" from "hold". Its new price target of ₹1,320 per share, indicates an upside potential of 19%.

Stock	Price Target (₹)	Upside
Mankind Pharma	2,900	32%
Ajanta Pharma	3,530	22%
Sun Pharma	2,100	22%
Zydus Life	1,130	23%

However, Jefferies remains negative on Dr Reddy's Laboratories.

The Nifty Pharma

index is trading 0.5% lower on Thursday. Barring Gland Pharma, Alkem Laboratories, Divi's Laboratories, Ajanta Pharma and IPCA Laboratories, the remaining 15 stocks in the index are trading with losses.

Piramal Pharma is the top loser on the Nifty Pharma index, currently trading with losses of 3%, while Wockhardt, Mankind Pharma and Torrent Pharma are trading with losses between 1.5% to 2.5%.

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