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Should you invest in healthcare or pharma funds?

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In its previous bull run from 2009 to 2016, the S&P BSE Healthcare Index jumped almost six times in seven years. That’s a compound annual growth rate (CAGR) of almost 30%.

The story turned sour in the four years that followed with the index losing around a third of its value in absolute terms. The 11-year CAGR of the index stands at a still respectable 14% but investors have endured a stomach churning roller coaster ride.

The covid-19 panic has once again set pharma stocks on fire and many investors ask themselves if this is the start of a second major bull run.

A presentation put out by DSP Mutual Fund explains that the twin engines of the sector were firing at full blast from FY 2009 to FY 2015 - exports to the US and sales in India’s

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