Sales and EBITDA for Indian pharmaceutical firms are projected to grow 11 per cent year-on-year in Q1FY26, driven by sustained market performance and export momentum.
Indian pharmaceutical companies are likely to post a steady 11 per cent growth in both sales and EBITDA for the first quarter of FY26. A new report by Kotak Institutional Equities attributes this rise to continued traction across most international and domestic markets, though weak domestic demand in April and March could slightly temper overall performance.
According to The Economic Times, the hospitals segment is expected to record a 17 per cent year-on-year growth, supported by an increase in patient footfalls, new bed additions, and a marginal improvement in average revenue per occupied bed (ARPOB). Diagnostics firms are projected to see 14 per cent growth in sales, driven by a combination of volume expansion, product mix improvements, and the impact of mergers and acquisitions.
India’s pharmaceutical market was valued at USD 50 billion for FY24, with USD 23.5 billion coming from domestic consumption and USD 26.5 billion from exports. The sector ranks third globally in terms of volume and 14th in terms of production value. It includes a broad spectrum of products such as generics, over-the-counter medicines, active pharmaceutical ingredients, vaccines, biosimilars, and biologics.
National Accounts Statistics 2024, published by the Ministry of Statistics and Programme Implementation, shows the total output from the pharmaceuticals, medicinal, and botanical products sector stood at ₹4.56 lakh crore at constant prices in FY23. The value added from this segment was ₹1.75 lakh crore, with employment figures reaching over 9.25 lakh people during the same year.
To support long-term growth and innovation, the government has focused on building R&D capabilities. Seven National Institutes of Pharmaceutical Education and Research (NIPERs) have been set up across the country to advance education and research in pharmaceutical sciences. These institutions, classified as institutes of national importance, also contribute to drug development and formulation improvements.
The Department of Pharmaceuticals has introduced the National Policy on Research & Development and Innovation in the Pharma-MedTech sector to strengthen India’s position in global drug discovery and medical technology. This policy aims to create an ecosystem that supports entrepreneurship, accelerates innovation, and bridges the gap between academic research and commercial application.
With stable growth indicators in Q1 and ongoing support for innovation and infrastructure, the pharma sector appears to be positioned for sustained expansion. The combination of domestic market strength, growing export opportunities, and a focused policy push for R&D may shape a more competitive and resilient industry over the coming years.
