IPM Sales Growth Accelerates 13.5% in Q1FY27; Nifty Pharma Jumps 14% YTD, Outperforms Nifty 50

Nifty Pharma index has climbed 14.53% year-to-date, while Nifty 50 has dropped 7.87% in the same period, making pharma one of the best-performing sectors on Dalal Street in 2026. The wide gap between the two indices comes as investors move money into pharma stocks at a time when the broader market is struggling with global uncertainty.

Nifty Pharma vs Nifty 50: Key Numbers

Pharma stocks have held up well this year even as the Nifty 50 fell. Improving earnings visibility, steady growth in domestic formulations, and a shift toward defensive stocks during volatile markets have all supported the rally. New product launches, strong execution at home, and steady margins have made pharma a preferred bet for many investors right now.

The Nifty 50, meanwhile, has been dragged down by rising geopolitical tensions in the Middle East, higher crude oil prices, continued FPI selling, and worries about inflation. Financials, IT and energy stocks have all been weak. Add to that the uncertainty around the US Federal Reserve's rate path and stretched valuations, and it's easy to see why money has been flowing into pharma instead.

Domestic Pharma Market Growth in Q1FY27

A report from Kotak neo Research, dated July 14, 2026 and based on backs up the pharma story with hard numbers on the Indian Pharmaceutical Market, or IPM.

IPM sales rose 16.0% year-on-year in June 2026, pushing overall growth for the first quarter of FY27 to 13.5% YoY. That's on top of 12.6% growth in April and 12.2% in May. And this happened even though sales of Semaglutide generics, the GLP-1 weight-loss drugs, were flat month-on-month in June. Take GLP-1 out of the mix and IPM sales still grew around 15% YoY in June and 13% YoY for the quarter.

Looking at the moving annual total (MAT) up to June 2026, IPM growth works out to 11.1% YoY, with volumes doing a lot of the heavy lifting. Chronic therapies grew 20% YoY in June, well ahead of acute therapies at 13%. Oncology, cardiac, anti-diabetic, VMN, pain, neuro and gynaecology drugs drove most of this growth.

Within the 11.1% MAT growth, pricing contributed 460 basis points and new launches added 310 bps. Volume growth added 340 bps, up sharply from just 120 bps a year ago, a sign that the growth is being driven by people actually buying more medicines, not just companies raising prices.

Top Pharma Companies Leading Q1FY27 Growth

A handful of companies stood out in the June quarter. Corona, La Renon, Glenmark, Intas, Ajanta, Lupin and Torrent all posted 16-19% YoY growth in Q1FY27, putting them ahead of the broader IPM.

The pickup in IPM growth (excluding GLP-1) is being put down to a few things: seasonal factors that brought more patients into clinics, higher sales of premium brands, deeper reach into smaller markets, and a small swing back toward offline pharmacies from modern trade. One risk flagged is that some sales could leak into alternate channels, which would understate the real IPM numbers going forward.

Torrent, Cipla, Sun Pharma Among Top Picks

Torrent, Cipla, Sun Pharma and Mankind stand out as the preferred picks by kotak Neo research within the sector, which holds an overall "Attractive" rating. On valuations, the space isn't cheap: current prices already bake in a slow, steady loss of market share for branded generics, but they don't yet account for any sharper slowdown in growth over the next few years.

Pharma Sector Outlook

Domestic formulations remain the biggest growth driver for Indian pharma companies right now, backed by real volume growth, steady margins, and double-digit gains at several large names. Where the rally goes from here will likely depend on whether volume growth holds up, how the GLP-1 opportunity plays out over the coming quarters, and whether valuations still have room to run.

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