Rich Indians join the global party in vaccine company stocks | Economic Times

Mumbai: Rich Indians have joined the global investment game of buying stocks of pharma MNCs at the frontline of Covid vaccine development. In the last couple of months, especially in recent weeks, many high networth individuals and even a few retail investors have bought stocks of Moderna, Pfizer, Johnson & Johnson, AstraZeneca, GlaxoSmithKline, Abbott and Sanofi.It’s all perfectly aboveboard – the stock buys happen via the Liberalised Remittance Scheme (LRS). “The trend of diversifying assets and hedging strategies away from home markets took off in 2014-15 and accelerated during the course of the pandemic around March and April this year,” said Nitin Shakdher, a professional institutional investor and founder of Green Capital Single Family Office. Many Platforms to Choose From“Recently we have seen accumulation in pharma stocks such as Pfizer, AstraZeneca, Abott and Sanofi both at home and in the international market,” he added.Moderna and Pfizer shares have rallied after the companies said their Covid-19 vaccines have achieved more than 94% and 90% efficacy, respectively, in phase-3 trials. Moderna has jumped over 33% since November 1 on NYSE while Pfizer, Johnson & Johnson, AstraZeneca and GlaxoSmithKline have gained between 8% and 12%.Rajiv Modi, CEO of Ahmedabad-based Cadila Pharmaceuticals, owns over 400,000 Novavax shares, currently worth $36 million. Modi is also on the board of Novavax, which is developing a Covid vaccine. The company’s shares surged from $3.98 on December 31, 2019 to hit an all-time high of $133.93 on July 24 this year. On Thursday, its shares were trading at $90 on NASDAQ.Under the LRS route, Indians can invest up to $250,000 in foreign stocks. A lot of domestic brokerages and standalone platforms such as ICICI Securities, Axis Securities, Kotak Securities, HDFC Securities, Geojit Financial Services, Upstox, Mastertrust, Winvesta, Stockal, among others, are now allowing Indians to invest directly in the US stock market.There is no minimum investment size and retail investors can invest as low as $1 for high priced shares by making investment in less than one stock.A few international brokerage firms such as Interactive Brokers, TD Ameritrade, Charles Schwab also allow Indians to set up an account and trade in US stocks, mutual funds and ETFs.“There has been a substantial increase in demand from HNIs, retail investors and those who track global equity investment markets for investing in global equities” said Satish Menon, executive director of Geojit Financial Services. “Since the beginning of 2020, Indian retail investors have bought over Rs 350 crore in overseas markets.”Some domestic wealth managers said global pharma stocks are “too speculative nowadays” and investments of Indians in them are still substantially lower compared to those in US IT stocks.“Currently only savvy investors are showing strong intent to spread risk and expand equity investment globally by betting in tech and pharma stocks listed in the US,” said B Gopkumar, CEO, Axis Securities. “But this trend may pick up going forward as many platforms have emerged in the last few months which offers investment in global stocks”.