Discreet investors have, however, made a quick comeback in the counter. In fact, they have already gained a little over 25 per cent.

On Friday, the scrip exhibited some profit-booking, but the news about the launch of new drugs will add to its upsurge in the next week.

Technically, it had come up against a resistance. Logically, therefore, some could expect the price to retract to its baseline. But considering the stock's intrinsic potential, it would make good sense to get back into Sun Pharma.

The company has a good approach to research and has been spending upto four per cent of its turnover on research. It is interesting to compare Ranbaxy Labs with Sun Pharma at this juncture. While Ranbaxy does put in research efforts, Sun Pharma scores miles ahead in terms of its product portfolio. It is into drug categories which have high growth potential.

The income levels in Indian households have been rising. The growth especially is noticeable in the middle and high income groups. Aspirations for better health have moved up as indeed the living pressures in the current age.

The longevity of the average Indian is believed to be around 60 years. Naturally, the well-to-do class wish to match the longevity of Americans and the Japanese, which is around 73 years. Cardiovascular drugs play an important part in the objective. If investors have taken a liking to Sun Pharma since last year from around the level of Rs 300, it is simply in recognition of the fact that the company's product profile has a great potential for sustained growth. The company has also taken a leading position in terms of establishing its brands.

The other segment, in which Sun Pharma excels is in the area of psychiatric drugs. These again are high growth segment, given the kind of life the society lives these days.

Sun Pharma's route to further research is seen to be both economical and efficient. It has invested $7.5 million towards equity in Caraco, to hold a 48.54 per cent stake. Considering that the company generates net profit of around Rs 60 crores, this is a small price to pay to secure its future growth.

Investors must remember that we are moving over the next two to three years into a scenario where more and more drugs will get out of the patent regime. With the background work already laid in technical and research competence, Sun Pharma could indeed add to its product range.

It is also putting in place a five-member scientific advisory board. With Caraco's connection, it will be able to unleash at least three new drugs in the near future.

Caraco, itself, is slated to break even in 2002 with a turnover of roughly $17 million. But the real consideration is its strong links it will provide to the FDA in US.

It will also serve as the window to US technology. It is such cosiderations that the investor must bear in mind and choose Sun Pharma for medium to long term investment during any decline.