Will Indian Pharma Revenue See a 7-9% Growth This Fiscal?
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Synopsis
Discover how India's pharmaceutical sector is set for a revenue leap of 7-9% this fiscal, sustaining strong profitability metrics. With the government’s recent GST cuts on crucial medications, affordability in healthcare is on the rise. Dive into the trends shaping this growth in the pharma landscape.
Key Takeaways
- Projected growth: 7-9% in the current fiscal year.
- Operating profitability: Expected to stay at 22-23%.
- Domestic revenue: Anticipated increase driven by price hikes and product launches.
- Export dynamics: 59% of formulation exports target regulated markets.
- Government support: GST cuts on essential medications.
New Delhi, Sep 24 (NationPress) The forecast for India’s pharmaceutical sector indicates a revenue increase of 7-9 percent for the ongoing fiscal year. Operating profitability is anticipated to hold steady at approximately 22-23 percent, accompanied by robust credit metrics, according to a report released on Wednesday.
Last fiscal year, the industry experienced a 10 percent growth. The stable input costs and a focus on new product launches are expected to balance out the rising compliance costs and the decline in exports of high-margin products to regulated markets, as noted in the report by Crisil Intelligence.
Additionally, the domestic revenue is projected to grow by 7-9 percent, spurred by increased realizations from annual price hikes and higher volumes due to innovative product launches.
The findings indicate that revenue is nearly evenly split between domestic sales and exports, with formulations representing about 83 percent of exports, while bulk drugs account for the remainder.
The research firm highlighted that 59 percent of formulation exports are directed towards regulated markets, with the United States being the top destination.
“Exports of formulations to regulated markets are expected to grow by 9-11 percent this fiscal, a deceleration from 14 percent over the past two years, primarily due to a high base,” stated Aniket Dani, Director at Crisil Intelligence.
New product introductions and existing drug shortages in the US are projected to further enhance exports. However, growth in semi-regulated markets is anticipated to be slower, around 5-7 percent, influenced by significant currency depreciation in various countries and ongoing quality concerns, he added.
Crisil Ratings Director Aditya Jhaver remarked that the replacement risk for Indian generics in the US is low, given the limited manufacturing capacities within the country. India continues to supply over 40 percent of generic prescriptions.
The government’s recent implementation of GST cuts exempted lifesaving and cancer medications, along with reducing rates on numerous other drugs from 12 percent to 5 percent. These amendments are likely to render essential therapies more affordable.
Point of View
I emphasize that India's pharmaceutical sector is navigating a landscape filled with challenges and opportunities. The projected growth of 7-9% not only reflects the industry’s adaptability but also highlights the government's commitment to enhancing healthcare affordability through strategic policy changes. It is crucial for stakeholders to remain informed and agile in this dynamic environment.
NationPress
24/09/2025
Frequently Asked Questions
What is the projected revenue growth for India's pharmaceutical industry?
The pharmaceutical industry in India is expected to grow by 7-9 percent in the current fiscal year.
What is the expected operating profitability for the sector?
Operating profitability is anticipated to remain around 22-23 percent.
What factors are driving the growth?
The growth is driven by stable input costs, new product launches, and annual price hikes.
How much of the revenue comes from exports?
Revenue is almost evenly split between domestic sales and exports, with 83 percent of exports being formulations.
What recent government measures may impact the sector?
The government has recently implemented GST cuts on lifesaving and cancer medications, which will likely make essential therapies more affordable.
