India’s pharmaceuticals market (IPM) is expected to post a slight uptick in FY25 in comparison to FY24 levels, even as domestic business growth for most companies is estimated to underwhelm Street expectations, stated a report by Elara Capital. According to Pharmatrac, the pharma industry grew by 6.3 per cent YoY in August 2024, below street expectations of 8-11 per cent. Volume declined by 0.2 per cent on-year but the increase in prices contributed to the growth. Volume growth, per Elara Capital, might accelerate albeit with moderate price increases.
“We reiterate organic growth will be in the range of 11-14 per cent for pharma stocks but fall short of our expectations. This presents a potential risk, particularly for companies reliant on the domestic business for overall profit,” the report added.
Value growth to be driven by cardiac, gastro-intestinal and anti-infectives segments
In August, the industry’s value growth was notable for the cardiac segment at 9.7 per cent YoY, followed by gastro-intestinal at 8.7 per cent and anti-infectives at 8.1 per cent YoY. Further, the anti-diabetic segment also achieved modest growth of 7.8 per cent YoY. Among smaller therapeutic areas, urology saw growth of 11.3 per cent YoY, hormones by 9.1 per cent YoY and derma by 8.5 per cent YoY. However, analgesics, respiratory, vitamins and minerals (VMN), oncology and gynecology reported growth, which was below IPM’s, said Elara Capital.
Volume growth continued to remain negative in August
During August, overall volume growth decelerated 0.2 per cent YoY. Among the top therapy areas, gastro-intestinal saw growth of 9.3 per cent YoY and anti-diabetic at 0.5 per cent YoY. Cardiac segment saw a weak performance too with a decline of 0.3 per cent YoY. Anti-infectives fell by 0.3 per cent YoY and VMN fell by 4.8 per cent YoY. Among smaller therapy areas, oncology posted robust volume growth of 22.5 per cent YoY and gynecology saw a decline of 1.3 per cent YoY in August.
Performance by key pharma companies
Among the top 20 companies, Elara Capital said, Aristo Pharma grew at 16.1 per cent, Torrent Pharmaceuticals achieved 12.7 per cent YoY growth and Intas Pharmaceuticals grew at 10.9 per cent YoY. Among other notables, Abbott India’s value growth was at 9.5 per cent YoY, with Glenmark at 9.4 per cent YoY, USV at 9.0 per cent YoY, Lupin at 8.7 per cent YoY, Pfizer at 8.2 per cent, Sun Pharma at 7.1 per cent YoY and Mankind Pharma at 6.5 per cent YoY. Conversely, it added, Cipla value growth was at 6.3 per cent YoY, Dr Reddy’s at 4.2 per cent YoY, IPCA Laboratories at 4.9 per cent YoY, Emcure Pharmaceuticals at 3.3 per cent YoY, Zydus Lifesciences at 1.9 per cent YoY and Glaxo’s at 1.3 per cent YoY, contributing to the drag on IPM growth.
