HSBC has stated that the exemption of pharmaceutical products from the latest round of US tariff announcements offers a notable reprieve for Indian pharma companies, many of which derive 10% to 50% of their revenues from the American market. The development eases immediate concerns of pricing pressure and supply chain disruptions for Indian drugmakers, which were earlier bracing for potential regulatory shocks.
While the brokerage acknowledged that tariff discussions on pharmaceuticals may resurface in future trade negotiations, it does not foresee any unmanageable tariff burden on the Indian pharma sector at this stage. HSBC believes that the structural dependency of the US on cost-efficient, high-quality generics from India makes punitive trade measures unlikely in the near term.
Further, HSBC noted that Indian companies with manufacturing plants or packaging units in the United States are in a better position to weather any potential regulatory developments. These assets serve as a natural hedge against trade-related uncertainties and provide operational continuity even if policies evolve.
The brokerage did not comment on specific stock calls but maintained that the broader outlook for Indian pharma remains supported by robust US demand, ongoing drug launches, and supply chain resilience.
Disclaimer: This article is for informational purposes only. Investors are advised to consult with certified financial advisors before making any investment decisions.
