Industry to log moderate growth this fiscal

The Indian pharmaceutical market (domestic and exports) logged a high CAGR of 9-10% between fiscals 2016 and 2021. The market expanded 7-8% on-year in fiscal 2022, led by strong growth in the domestic market and exports to semi-regulated markets.

In fiscal 2023, sector growth will moderate to 5-7% on-year owing to pricing pressure in the United States (US) and decent growth in the domestic market.

High demand for Covid-19 drugs had lifted growth in first half of last fiscal

Domestic markets grew 15-16% in fiscal 2022, riding on robust growth in the first half due to increased demand for Covid-19-related drugs. In the first quarter of the fiscal, the market expanded ~39% due to high demand for acute therapy drugs such as antiinfectives and vitamins, thereby helping the industry expand robustly.

For the full fiscal, growth was led by an increase in volume as well as price. Vaccines have provided the industry an one-off opportunity, albeit limited to the top vaccine manufacturers.