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India Pharma Sector Check - Favorable Risk Reward: Systematix

India Pharma Sector Check - Favorable Risk Reward: Systematix

<div class="paragraphs"><p>Colourful medicines arranged for photograph. (Source: pxhere)</p></div>
Colourful medicines arranged for photograph. (Source: pxhere)

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Systematix Research Report

The Indian pharma sector is poised for mid-single to high-single-digit sales growth and margin expansion. Our positive outlook on sector stems from

  1. likely easing of inflationary pressures,

  2. expected easing of price erosion pressure in the U.S.,

  3. monetisation opportunities in complex generics, and

  4. secular growth potential in branded formulations (India and emerging markets).

Tailwinds from a potential cyclical upturn in oral sold pricing in the developed markets and scale up in China market for select players is something we not factored in our estimates, and is a free call option.

News flows on new chemical entity pipeline should improve the medium-to-long-term growth sentiment, and trickle into valuation multiples. Companies now are cash positive, and have strong free cash flow generation, which they could leverage for opportunistic acquisitions.

Click on the attachment to read the full report:

Systematix - India Pharmaceuticals Sector Report.pdf

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