Crisil says slowing growth of exports might limit pharma YoY revenue growth for FY22

5 per cent during the previous fiscal, Crisil said.New Delhi, November 16 : .

Indias revenue growth in the pharmaceutical sector will be moderated to 9 percent for FY22.This is compared to a strong rise of 12.5 percentage points during the last fiscal Crisil statedThe agency attributed slower growth in exports, weak support from Covid-19 vaccine opportunities, and a slow pick-up in demand in the domestic formulations market as some of the reasons behind the possible degrowth.According to the agency, the degrowth could be attributed to slower export growth, lower support for Covid-19 vaccination opportunities and slow demand on the domestic formulas market "Operating profitability will shrink, too, by as much as 300 basis points this fiscal, due to a sharp increase in input and other costs.

Due to sharp increases in input costs, operating profitability could also shrink by up to 300 basis points.Well-managed balance sheets and prudent capital spends will, however, help keep credit quality stable.".However, credit quality will be maintained if balances are well managed and capital expenditures are prudent "Exports have been sluggish because of intense competition among generic players amid intensifying pricing pressure in the US market and lower visibility of new product launches due to delay in closure of regulatory actions on manufacturing plants by the US Food and Drug Administration (US FDA)."."Exports were slow due to intense competition between generic players, intensifying price pressure in the US and reduced visibility of product launches due delay in closing regulatory actions by the US Food Drug Administration (US FDA) on manufacturing plants.On the other hand, domestic demand is witnessing a steady recovery after tepid performance last fiscal, said Isha Chaudhary, Director at Crisil Research.

According to Isha Chaudhary (Director at Crisil), domestic demand is experiencing a steady rebound after the tepid performance of last fiscal "With normalcy returning to healthcare delivery services, domestic formulations revenue, led by acute therapies, is estimated to grow 14-16 per cent this fiscal, compared with 2 per cent last fiscal.Domestic formulations revenues, including acute therapies, are expected to increase by 14-16 percent this fiscal as normal returns to healthcare delivery services.This compares with 2% last fiscal.

Further, with ramped-up capacities and improving pace of vaccination, Covid-19 vaccines also provide additional domestic growth potential this fiscal," Chaudhury said.Chaudhury stated that Covid-19 vaccines, which have a higher production rate and a faster pace to vaccination, also offer additional domestic growth opportunities this fiscal.rv-animesh/sn/skp #Crisil #limit #pharma #Delhi.