Pharmaceutical companies under our coverage are expected to report a 23.4% increase in their revenues for Q2FY2009. The revenue growth would be driven by a steady growth in the domestic market, the new product launches in the regulated markets, a strong growth in the contract research and manufacturing services (CRAMS) businesses and the consolidation of the acquisitions made in the previous year. Further, with exports accounting for over 50% of the pharmaceutical industry’s revenues, the weaker rupee (Indian Rupee has depreciated by around 8% over the last one year) would also aid the top line growth only partially as most companies have hedged their outstanding receivables at around the Rs41-42 level. Sun Pharmaceutical Industries (Sun Pharma) would be the biggest beneficiary of the weaker rupee, since it has not hedged aggressively at the higher levels of the rupee, relying more on the natural hedge mechanism.

Ranbaxy, Sun Pharma, Wockhardt, Lupin, Nicholas Piramal, Orchid Chemicals, Cadila Healthcare, Glenmark, Elder Pharma, IPCA Lab, Opto Circuits, Surya Pharma, Torrents Pharma

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