Summary:

According to CRISIL Ratings, the Indian pharmaceutical sector is projected to grow by 8-10% this fiscal year, driven by strong exports to regulated markets such as the United States and Europe, a resurgence in semi-regulated markets like Africa and Asia, and stable domestic demand. This follows a solid 10% increase last year. Reduced pricing pressure and improved operating leverage are expected to boost margins to around 22.5%, while consistent cash flows and minimal financial leverage provide stability.

The report predicts a 12-14% increase in formulation exports in rupee terms, with regulated markets rising 13-15% due to drug shortages and new product launches. Exports to semi-regulated markets are expected to rise 8-10%, supported by stronger currencies. Domestic revenue should grow by 7-9%, driven by price increases in non-NLEM items, although growth in the NLEM portfolio may be muted. CRISIL also warns of risks related to debt-financed acquisitions, regulatory challenges, price caps, and US antitrust lawsuits.

Source: IBEF 

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