Pharma sales may be up 9-10% in Q2

Domestic business and exports are expected to be a shot in the arm; hospitals and diagnostics to lag

- SOHINI DAS

Pharmaceutical revenues are likely to have grown 9-10 per cent year-on-year (Y-0-Y) in Q2FY26, riding on sustained domestic business as well as high single digit US market growth, despite price erosion in key cancer drug Revlimid.

Nuvama estimates revenue and profit after tax growth of 9 per cent and 10 percent, respectively Y-0-Y, and 3 per cent and 2 per cent, respectively quarter-on-quarter (Q-0-Q).

Domestic business is expected to grow at 10 per cent during the quarter, with Ajanta Pharma, Alkem likely to outperform peers. However, GST rate cuts may cause some working capital issues due to an inverted duty structure with respect to domestic sales.

US sales for most pharma companies are likely to grow at a decent 7 per cent rate, despite price erosion in generic Revlimid, the analysts noted. Margins are likely to benefit from the active-pharmaceutical-ingredient (APIs) price cuts by China, which may positively surprise formulation companies’ margins.