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Domestic Pharma growth remains strong

ICICIdirect Research 13 Mar 2026 DISCLAIMER

Pharma stocks have remained resilient amid market volatility. While Nifty has fallen ~6% in the last month due to the Middle East crisis, the Nifty Pharma index has gained ~7%, supported by consistent domestic market growth.

The domestic pharmaceutical market grew 12.4% year on year in February 2026 to ₹21,108 crore, following ~12% growth in January 2026 and ~15% in December 2025.

On a trailing twelve month basis, the market grew ~10% to ₹2,54,427 crore, which is above the expected 7–9% growth range.

Chronic therapies grew 17%, while acute therapies grew 10% during the month.

By therapy segment
– Cardiovascular growth stood at 17%
– Anti diabetic therapies grew 16%
– Vitamins grew 15%
– Gynecology grew 12%

Among listed companies, Ajanta Pharma (16%), Sun Pharma (15%), and Ipca Labs, Lupin, Torrent Pharma and Dr Reddy (14% each) recorded the highest growth.

This marks the third consecutive month of strong growth, driven by higher patient volumes, increased demand for high value brands in diabetes, expansion into tier II to VI towns, and continued traction in chronic therapies such as cardiology and diabetology.

The outlook for domestic pharma remains positive. Rising lifestyle diseases and new obesity drugs are expected to support demand.

The upcoming Schedule M implementation with stricter manufacturing norms may push out smaller non-compliant manufacturers, creating an opportunity of ₹75,000 crore (about 30% of the domestic pharma market) for established players.

Preferred companies with strong domestic formulation focus

  • Sun Pharma
  • Dr Reddy
  • Ajanta Pharma
  • Ipca Labs
  • Pfizer
  • P&G Health

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