Pharmaceuticals: 1QFY25 sector earnings up 4x – By Sherman Research

<p></p><ul><li><span style="font-family:Arial, Helvetica, sans-serif;font-size:medium;">Despite the fact that sector&rsquo;s production remained flat during 2MFY25 versus last year (as reported in LSM figures by PBS), pharmaceutical sector emerged as a unicorn in these testing times, thanks to sharp recovery in gross margin. The industry posted net earnings of Rs7.5bn in 1QFY25 as compared to Rs1.8bn in 1QFY24, up by 4x (see table1). Our Pharma sector sample includes ten companies which represent more than 94% of the sector&rsquo;s market capitalization.</span></li></ul><ul><li><span style="font-family:Arial, Helvetica, sans-serif;font-size:medium;">Interestingly, pharma companies posted cumulative gross profit of Rs26.8bn versus Rs16.6bn last year which resulted into gross margin expansion of 11ppts from 26% to 37% during 1QFY25 ...