Pharma listed cos: FY26 profits surge 28pc to Rs42.2bn YoY
KARACHI: Profitability of Pakistan’s listed pharmaceutical sector increased 28 percent year-on-year (YoY) to Rs42.2 billion in FY26, mainly supported by price-led growth and lower finance costs, according to a Research report issued. However, sector earnings declined 2 percent YoY and 26 percent quarter-on-quarter (QoQ) in 4QFY26, primarily due to the loss posted by The Searle Company Limited…
Pakistan's pharmaceutical sector reported a 28% surge in profits for the fiscal year 2026 (FY26), reaching Rs42.2 billion, according to a research report. This growth was driven by price-led increases and reduced finance costs. However, earnings for the year declined 2% YoY and 26% QoQ, primarily due to SEARL's losses. Excluding SEARL, sector profitability still grew 22% YoY.
Despite the earnings improvement, the sector's market capitalization excluding SEARL and Liven Pharma only saw a 0.4% YoY increase. Net sales grew 10% YoY to Rs377.9 billion in FY26, driven by higher prices. In Q4FY26, sales were up 3% YoY but down 3% QoQ to Rs88.9 billion. Abbott Laboratories contributed 20% of sales, followed by GlaxoSmithKline at 18%, Haleon at 11%, and SEARL at 10%.
The sector's gross margin hit an all-time high of 42.8% in FY26, up from 38.9% in FY25. Net inventories averaged around 60 days. AGP Limited had the highest gross margin at 60.4% in FY26. Selling and distribution expenses increased 21% YoY to Rs69.5 billion in FY26. Finance costs dropped 42% YoY to Rs3.6 billion in FY26. Other income rose 2% YoY to Rs6.5 billion in FY26, with a significant increase from Hoechst Pakistan Limited.
The effective tax rate (ETR) was 42.5% in FY26, up from 39.8% in FY25. Looking ahead, the sector expects a recovery in volumes from the second half of 2027, supported by a low base effect in 2026 and expanding product portfolios.
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