Ajanta still seems to be coming out with good new first time in India products though I dont track them very closely nor do I meet their representatives too much.
Regarding Alembic it is one of the few companies which has remained well compliant with USFDA audits. In their last visit the fda guys gave 3 minor observatioins which are likely to be resolved easily.
Both Ajanta and Alembic have invested a lot in building assets by expansions. With a dip in demand these companies are likely to see a compression in their return ratios which is often a trigger for de rating. I think that’s what is going on with correction in stock prices of both companies. Besides a string of mediocre results.
At the risk of sounding like a broken string, I would like to reiterate that whenever a sector which was a market darling loses favor with the markets it takes a very long time for the sector to make a comeback. Even if we were smart enough to catch the precise bottom, these stocks are likely to spend a lot of time in consolidation within a range. I still feel its prudent to be lightweight on the sector rather than trying to be too clever and be a contrarian. In contrarian investing we have to be a contrarian and more importantly right.