'The outlook for the healthcare sector is positive'

The recent market crash has hit almost all sectors. But the healthcare sector didn't suffer much damage, with the BSE Healthcare Index sporting a year-to-date return of over 12 per cent (as on April 22, 2020). After underperforming the market for a few years, the sector has come back on investors' radar due to the outbreak of COVID-19. We speak to Sailesh Raj Bhan, Deputy CIO - Equity Investments, Nippon India Mutual Fund, who manages Nippon India Pharma Fund, regarding what's changing in the sector and whether it is poised to regain its lost charisma. In the market fall of March 2020, the pharma sector was least affected. Why did it happen? The pharma sector was resilient in the recent fall, given that the sector is one of the least-impacted sectors in the current environment. The earnings of the sector have also been on the mend over the last 12 months, while valuations were inexpensive. The profit share of the India business, which is more lucrative, has also increased in the last five years for most Indian companies. The outlook for healthcare as a sector is positive over the next two to three years when compared to most sectors of the economy, which will undergo slowdown on account of the economic impact of the lockdown. Many global pharma giants are vying to develop a vaccine for the coronavirus. Where do Indian companies stand? Where is the opportunity for investors? Global research to develop a vaccine is progressing very fast with a large amount of resources being deployed. India is significantly ahead in pharmaceutical manufacturing, but it lags in core research and development efforts, given the large scale funding of these programmes. Global players have a clear edge in terms of vaccine development, while India can scale its