India Healthcare Q1 Results Preview - U.S. To Drive Performance: Systematix

Systematix Research Report

Q1 FY25 earnings growth will witness meaningful support from a favorable trajectory in the U.S. business led by ramp up in high value launches. On the domestic front, those with higher exposure to National List of Essential Medicine may show higher reported growth owing to a low base last year (ceiling price revisions and new introductions in the NLEM list).

As per AIOCD AWACS, India pharmaceutical market grew 7.7% during the quarter. The WPI index is 0% for the year and hence growth led by price revisions on DPCO drugs will be impacted.

The price revisions start to reflect from the second quarter of the financial year. Decline in API prices should help gross margins in domestic markets. In export marktes, the benefit of lower raw material prices should eventually pased through to customers.

Overall, we expect revenue /Ebitda and profit after tax for our coverage universe to grow at 5%/7%/16% on a QoQ and 8%/6%/27% on a YoY basis respectively.

Zydus should be the best performer led by a new limited competition launch – miragbegron.

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