Seeking a glimpse into India’s thriving healthcare sector? Look no further than the Nifty Healthcare index! This dynamic index tracks the top 20 healthcare companies, offering a window into the industry’s growth and potential. From pharmaceuticals to medical devices, the Nifty Healthcare pulse reflects the heart of India’s medical revolution.

In this blog, discover how to analyse Nifty Healthcare stocks through factor-based investing methodology.

What is the Nifty Healthcare?

The Nifty Healthcare Index is a sectoral index that reflects the behaviour and performance of the Indian healthcare sector. Launched in 2020, it includes 20 stocks.

The Nifty Healthcare index is calculated using the free float market capitalisation method with a base date of April 01, 2005, and a base value of 1000.

Factor Based Analysis of Nifty Healthcare Stocks 

In this analysis, let’s focus on three essential factors – momentum, value, and quality – to evaluate Nifty Healthcare stocks.

Here’s a breakdown of each factor:

Momentum Factor 

Think of investing in momentum stocks like a care race. A fast car (high-momentum stocks) speeds ahead, while a slow car (low-momentum stocks) lags. The momentum factor strategy involves betting on winners (fast cars) to keep winning and losers (slow cars) to stay behind. Investors buy strong-performing stocks and avoid weak ones.

Value Factor 

Picture this: a sale catches your eye, and you spot a fantastic lamp at a fair price. Now, apply that idea to the stock market. This strategy checks if a stock is reasonably priced, just like you would with the lamp.

Quality Factor 

Quality factor investment strategy is like building a sturdy home with top-notch materials. Investing in high-quality stocks is similar, focusing on companies with strong financials, reliable management, and sustainable growth. Just as quality raw materials ensure a durable home, these factors aim for a resilient investment portfolio.

The Nifty Healthcare Stocks are rated from 1 to 5 stars, with 1 being the lowest and 5 being the highest.

Factor-based analysis of Nifty Healthcare Stocks

Nifty Healthcare StocksValue FactorMomentum FactorQuality Factor
Abbott India Ltd.⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐
Alkem Laboratories Ltd.⭐⭐⭐⭐⭐⭐⭐⭐⭐
Apollo Hospitals Enterprise Ltd.⭐⭐⭐⭐⭐⭐⭐⭐
Aurobindo Pharma Ltd.⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐
Biocon Ltd.⭐⭐⭐⭐⭐⭐⭐
Cipla Ltd.⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐
Divi’s Laboratories Ltd.⭐⭐⭐⭐⭐⭐
Dr. Lal Path Labs Ltd.⭐⭐⭐⭐⭐⭐⭐⭐
Dr.Reddy’s Laboratories Ltd.⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐
Glenmark Pharmaceuticals Ltd.⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐
Granules India Ltd.⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐
Ipca Laboratories Ltd.⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐
Laurus Labs Ltd.⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐
Lupin Ltd.⭐⭐⭐⭐⭐⭐⭐⭐
Max Healthcare Institute Ltd.⭐⭐⭐⭐⭐⭐⭐⭐
Metropolis Healthcare Ltd.⭐⭐⭐⭐⭐⭐⭐⭐
Sun Pharmaceutical Industries Ltd.⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐
Syngene International Ltd.⭐⭐⭐⭐⭐⭐⭐
Torrent Pharmaceuticals Ltd.⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐
Zydus Lifesciences Ltd.⭐⭐⭐⭐⭐⭐⭐⭐⭐⭐

Note: The above healthcare stock data is from March 06, 2024. The lists of healthcare stock provided above are purely for educational purposes. These are not stock recommendations. Consult your financial advisor or do your own research before investing. 

Conclusion

In conclusion, exploring the Nifty healthcare sector involves understanding its dynamic stocks through a factor-based investing approach. Investors can navigate this engine on wheels by analysing momentum, value, and quality factors. Before making investments, either seek advice from your financial advisor or conduct thorough research on your own.

FAQs

Which healthcare stock has the highest weightage in the Nifty Healthcare Index?

Sun Pharmaceutical Industries Ltd has the highest weight of 23.09% in the Nifty Healthcare Index as of February 29 2024.

Who are the top players in the Healthcare Sector?

Dr. Reddy’s Laboratories Ltd, Cipla Ltd and Apollo Hospitals Enterprise Ltd. are a few top players in the Healthcare sector.

How volatile is the Nifty Healthcare Index?

The volatility of the Nifty Healthcare Index can vary, but it is generally considered to be moderate. Factors such as regulatory changes, global health trends, and individual stock performance can influence its volatility. Investors should monitor market conditions and industry developments for informed decision-making.