Last Updated on Jul 4, 2023 by Anjali Chourasiya
India’s pharmaceutical industry holds a remarkable global ranking of 3rd in production volume and 14th in value. It boasts 3,000 drug companies and 10,500 manufacturing units, contributing 1.72% to the country’s GDP. There are over 150 pharmaceutical stocks in India. Now, if you are wondering ‘which pharmaceutical stock to buy for the long term?’, then look no further! In this article, let’s dive into the best pharma stocks based on various parameters that indicate long-term growth.
Table of Contents
Best pharma stocks in India for long-term
| Name | Market Cap (Rs. in cr.) | Close Price (Rs.) | PE Ratio | 5Y Avg Net Profit Margin (%) | 5Y Avg Return on Investment (%) | Fundamental Score |
| Gland Pharma Ltd | 16,366.32 | 993.70 | 20.95 | 24.64 | 16.93 | 8.03 |
| J B Chemicals and Pharmaceuticals Ltd | 16,682.56 | 2,154.90 | 40.71 | 15.16 | 16.76 | 6.41 |
| Ajanta Pharma Ltd | 18,491.97 | 1,468.60 | 31.45 | 18.89 | 20.35 | 6.32 |
| Eris Lifesciences Ltd | 9,044.23 | 665.05 | 23.67 | 27.42 | 22.73 | 6.10 |
| Sanofi India Ltd | 15,773.67 | 6,849.00 | 25.42 | 18.01 | 29.30 | 5.84 |
| F D C Ltd | 5,046.16 | 304.15 | 26.01 | 15.42 | 13.92 | 5.79 |
| Natco Pharma Ltd | 11,114.66 | 620.55 | 15.54 | 21.19 | 13.03 | 3.83 |
| GlaxoSmithKline Pharmaceuticals Ltd | 23,649.08 | 1,396.00 | 38.73 | 16.33 | 26.10 | 3.56 |
Note: The above-mentioned list of pharma stocks was sorted using Tickertape Stock Screener on 14th June 2023. Following parameters are used to get the desired list.
- Stock Universe > Nifty 500
- Sector > Pharmaceuticals
- 5Y Avg Net Profit Margin – Set to high
- 5Y Avg Return on Investment – Set to high
- Fundamental Score – Sort it from highest to lowest
Details of top pharma stocks in India
Gland Pharma Ltd
Established in Hyderabad in 1978, Gland Pharma has grown over the years from a contract manufacturer [HK1] of small-volume liquid parenteral products to become one of the largest and fastest-growing generic injectables manufacturing companies, with a global footprint across 60 countries.
As of 14th June 2023, its market capitalisation was Rs. 16,366.32 cr., and the stock price was Rs. 993.7. Gland Pharma Ltd’s 1-yr return was -63.55%. Gland Pharma Ltd’s 5-yr ROI and net profit margin are 16.92% and 24.64%, respectively. The fundamental score of the stock is 8.03.
J B Chemicals and Pharmaceuticals Ltd
Established in 1976, J.B.Chemicals & Pharmaceuticals Ltd. (JBCPL) is India’s fastest-growing pharmaceutical company. It exports to over 30 countries across the world and earns more than half its revenue from its international business. JBCPL is widely committed to manufacturing a range of innovative speciality products that include various pharmaceutical dosage forms like tablets, injectables (vials, ampoules, form fill seal), creams & ointments, lozenges, herbal liquids and capsules.
The company, as of 14th June 2023, had a market capitalisation of Rs. 16,682.56 cr. and a stock price of Rs. 2,154.9. J B Chemicals and Pharmaceuticals Ltd’s 1-yr return is 42.92%, and its 5-yr CAGR is 51.35%. The company’s 5-yr ROI and net profit margin are 16.75% and 15.15%, respectively. The fundamental score of the stock is 6.40.
Ajanta Pharma Ltd
Ajanta Pharma Ltd produces a comprehensive range of speciality products targeting different therapeutic segments for the treatment of patients, customised to each market. The company is a speciality pharmaceutical company engaged in the development, manufacturing and marketing of quality finished dosages.
On 14th June 2023, the company’s market capitalisation was Rs. 18,491.97 cr., and its stock price was Rs. 1,468.60. Ajanta Pharma Ltd’s 1-yr return and 5-yr CAGR were 24.35% and 16.29%, respectively. The company’s 5-yr ROI is 20.35%, and its net profit margin is 18.88%. The fundamental score of the stock is 6.31.
Eris Lifesciences Ltd
Established in 2007, Eris Lifesciences Ltd has a leading presence in its core cardio-metabolic franchise just 15 yrs from inception. Eris is also successfully diversifying its business with 3 emerging therapies (Dermatology, Neuropsychiatry and Gynaecology), accounting for 20% of its revenue and growing at > 25% p.a.
As of 14th June 2023, the company’s market capitalisation and stock price were Rs. 9,044.23 cr. and Rs. 665.05, respectively. Eris Lifesciences Ltd’s 1-yr return is 2.20%, and the 5-yr CAGR is -2.80. The company’s 5-yr ROI and net profit margin are 22.73% and 27.41%, respectively. The fundamental score of the stock is 6.095.
Sanofi India Ltd
Sanofi India Ltd is one of the entities of Sanofi in India. Present in the country since 1956, it was born under the name of Hoechst Fedco Pharma Private Limited. The company’s four products are featured in the top 100 pharmaceutical brands in India.
The company, as of 14th June 2023, had a market capitalisation of Rs. 15,773.67 cr. and a stock price of Rs. 6,849. Sanofi India Ltd’s 1-yr return and 5-yr CAGR were 3.44% and 6.13%. The company’s 5-yr ROI and net profit margin are 29.29% and 18.01%, respectively. The fundamental score of the stock is 5.83.
F D C Ltd
Founded in 1936 as a company distributing a few products nationally to making top quality products, FDC Ltd has aimed high and provided the medical sector with its prestigious products, growing the company’s overall turnover to over Rs. 15 bn.
As of 14th June 2023, its market capitalisation was Rs. 5,046.15 cr., and its stock price was Rs. 304.15. F D C Ltd’s 1-yr return is 29.34%, and the 5-yr CAGR is 3.98%. The company’s 5-yr ROI is 13.91%, and its net profit margin is 15.41%. The fundamental score of the stock is 5.78.
Natco Pharma Ltd
Natco Pharma Ltd was incorporated in Hyderabad in the year 1981. It is an India-based, vertically integrated, research and development-based pharmaceutical company. Nacto Pharma deals in the business of manufacturing and selling bulk drugs and finished dosage formulations.
The company, as of 14th June 2023, had a market capitalisation of Rs. 11,114.66 cr. and a stock price of Rs. 620.55. Natco Pharma Ltd’s 1-yr return and 5-yr CAGR were -7.47% and -4.89%. The company’s 5-yr ROI and net profit margin are 13.02% and 21.19%, respectively. The fundamental score of the stock is 3.83.
GlaxoSmithKline Pharmaceuticals Ltd
GlaxoSmithKline Pharmaceuticals Ltd is one of the oldest pharmaceuticals company. The company’s portfolio includes prescription medicines and vaccines. Their prescription medicines range across therapeutic areas such as anti-infectives, dermatology, gynaecology, diabetes, oncology, cardiovascular disease and respiratory diseases.
On 14th June 2023, the company’s market capitalisation was Rs. 23,649.08 cr., and its stock price was Rs. 1,396. GlaxoSmithKline Pharmaceuticals Ltd’s 1-yr return is -8.90%, and the 5-yr CAGR is -0.08%. The company’s 5-yr ROI is 26.09%, and its net profit margin is 16.32%. The fundamental score of the stock is 3.55.
Conclusion
The Indian pharmaceutical sector faced a setback in April with a 1% decline in sales, primarily driven by a drop in volume growth. However, a growth rate of 10-11% is expected for the fiscal year 2024. The Nifty Pharma Index has witnessed a remarkable turnaround, reflecting a growth rate of 17% per year. The biosimilars market presents promising growth opportunities supported by government funding and initiatives. The industry aims to reach a market size of $130 billion by 2030. We analysed the pharmaceutical sector thoroughly in our weekly newsletter! Subscribe now for various in-depth insights.
As an insatiable reader and learner, I’ve spent the last two years exploring the world of finance. With my creative mind and curious spirit, I love making complex finance topics easy and fun for everyone to understand. Join me on my journey as we navigate the world of finance together!
