The Indian pharmaceutical sector will likely see 7-9% revenue growth in FY 2026, driven by strong domestic and European demand, despite a slowdown in the US market, a report by ICRA revealed on Thursday.
ICRA notes that global challenges and regulatory uncertainties have affected the US, India’s largest export market. However, the domestic market should grow by 8-10%, and Europe is expected to see growth of 10-12%.
Operating profit margins (OPM) are likely to remain stable at 24-25% in FY26, similar to FY25. This stability comes from favorable raw material prices, better operating leverage, and a higher share of specialty products.
US revenues are expected to slow with YoY growth of 3-5%, down from nearly 10% in FY25. However, ICRA’s report highlights Q1 FY26 saw 10.3% YoY growth, driven by market share gains and new product introductions.
ICRA kept a stable outlook for the sector, citing steady revenue growth, strong liquidity, and solid profit margins.
