With 30-47% of their revenues linked to the US market, analysts are assessing which steadiness sheets may very well be hit hardest if Trump’s tariff measures lengthen past branded medication to incorporate complicated generics and specialty medicines.
The US is the most important marketplace for Indian pharma, accounting for roughly 35% of exports, valued at about $10 billion in FY25.
“President Trump’s tantrums with tariffs are resuming with new tariff imposts on patented and branded medication,” mentioned Dr. VK Vijayakumar, Chief Funding Strategist at Geojit Investments Restricted. “India, being an exporter of generic medication, is unlikely to be impacted by this. However maybe the president’s subsequent goal will be generic medication.”
“Whereas the tariff primarily targets branded medication, there’s ambiguity over whether or not complicated generics and specialty medicines may also be affected,” warned Maitri Sheth from Alternative Institutional Equities. “Nevertheless, companies with manufacturing crops beneath building within the U.S. will likely be exempt, providing a chance to mitigate tariff publicity.”
“Predominantly, Solar Pharma appears to be most impacted. Dr Reddy’s will even be impacted. The vast majority of the gamers are into generics. The influence on branded generics isn’t very clear,” Sunny Agarwal of SBI Securities advised ET Markets.
Dr Reddy’s: The Most Uncovered?
Dr. Reddy’s has emerged as one of the weak, with a staggering 47% of its income depending on the US market–the best amongst main friends. Nomura estimates DRL’s US revenues at $1.5 billion in FY26, making any tariff enlargement probably catastrophic.”Merchandise manufactured within the US ought to contribute lower than 15% to FY27F revenues,” Nomura famous, that means the majority of DRL’s American operations stay uncovered to potential tariff warfare. Choose merchandise like gSuboxone are at the moment formulated within the US, providing restricted safety.
Solar Pharma: Specialty Manufacturers Below Fireplace
Solar Pharma’s 37% US publicity places $2.1-2.3 billion of its FY26 revenues in danger. The corporate’s Achilles heel? “Specialty manufacturers account for 55–57% of revenues,” in accordance with Nomura, with solely 10% of US specialty revenues produced domestically.
The corporate’s top-selling product, Ilumya, is formulated exterior the US, most certainly in Eire, putting it squarely within the crosshairs of Trump’s insurance policies. Nevertheless, Nomura analysts notice that “since Ilumya is a continual remedy, Solar might be able to cross on the influence of tariffs and retain present volumes.”
Solar Pharma shares have already felt the influence, plunging as much as 5% to a recent 52-week low of Rs 1,547.25 on the BSE.
Cipla: The Relative Protected Haven
Cipla seems the least uncovered, with 30% of its revenues tied to the US, estimated at $900–950 million in FY26/27. The corporate’s Invagen websites working within the US contribute 25–30% of US revenues, offering some safety in opposition to tariffs.
“The corporate is increasing its US manufacturing publish regulatory points at Indian websites,” offering a possible buffer in opposition to future tariff escalations.
The Broader Influence Throughout Indian Pharma
Different main gamers face various levels of publicity. Lupin’s US revenues are estimated at $1.1 billion in FY26, with manufacturing websites within the US contributing round $70-80 million in revenues-roughly 6-7% of complete revenues, in accordance with the corporate.
Zydus Lifesciences faces important danger with US revenues estimated at $1.3 billion in FY26/27 and really restricted US manufacturing. “Given the excessive dependence of US revenues, we anticipate the earnings influence will be excessive in case the corporate had been to soak up the influence of tariffs,” analysts famous.
Aurobindo Pharma, the most important Indian generic firm with US gross sales of $1.6 billion in CY2024, has three manufacturing websites within the US, although manufacturing and contribution from these websites stay restricted. The corporate expects oral dosage kind manufacturing may very well be scaled as much as 12–15 billion items, probably catering to a 3rd of US gross sales.
Glenmark has arrange a producing website in Monroe, however it at the moment contributes nothing, as the ability stays beneath a warning letter. US revenues are estimated at $393–461 million in FY26/27.
Gland Pharma is “comparatively higher positioned in comparison with different generic corporations,” with US revenues of $372–393 million in FY26/27. Competitors in injectables is comparatively low, and the corporate primarily competes with Chinese language gamers more likely to face greater tariffs.
Alkem faces potential influence, with US revenues of $336–372 million in FY26/27, largely equipped from India. “The corporate could also be impacted if the tariff isn’t handed on to prospects,” because it has small-scale operations and isn’t vertically built-in.
Torrent Pharma has the smallest US publicity, at $141–156 million in FY26/27. “Given the small scale of operations and a scarcity of differentiating merchandise, the profitability of its US operations is low,” elevating questions concerning the sustainability of its US technique if tariffs broaden.
ICICI Securities’ Pankaj Pandey notes that the “near-term influence of the tariffs is more likely to be restricted, as India primarily exports generics.” Nevertheless, he provides: “Uncertainty nonetheless stays over whether or not complicated generics and biosimilars will come beneath the tariff embargo sooner or later.”
Trump’s exemption clause gives a lifeline – corporations which have “damaged floor on constructing a producing plant in the USA” can escape the 100% obligation. However for companies nonetheless wedded to Indian manufacturing, October 1 marks the beginning of a possible earnings massacre.
As pharma shares brace for a sell-off within the days forward, the market awaits readability on whether or not Trump’s tariff campaign will broaden past branded medication to engulf all the $10 billion Indian pharma export business.
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