Pharma Stocks Slide: Aurobindo Pharma, Lupin, Dr Reddy’s, and Others See Sharp Decline Amid Tariff Concerns

Market Performance

On July 8, Indian pharmaceutical stocks experienced a notable dip in early trade as global trade tensions escalated. The Nifty Pharma index slipped nearly 1%, hovering around 22,159 during morning hours.

This marked the second straight day of losses for the index, after an extended 10-session rally. The downward trend was triggered by geopolitical jitters and concerns surrounding international tariff policies.

Main News

Pharma stocks, including Aurobindo Pharma, Lupin, Dr Reddy's Laboratories, Zydus Lifesciences, Granules, Sun Pharma, Cipla, Torrent Pharma, Ajanta Pharma, Laurus Labs, and Glenmark Pharma, saw their share prices come under pressure following reports of new tariff letters issued by US President Donald Trump.

On July 7, the US administration reportedly sent letters to about 14 countries, imposing new import tariffs, effective August 1. The move rekindled market concerns over global trade barriers, particularly as India and the US continue to negotiate a trade agreement.

The timing of the US action has become a matter of concern, as it may disrupt India's pharmaceutical export plans, especially when discussions for a "mini-deal" are ongoing between the two countries.

Company Details

Several key pharma firms experienced a sharp drop in share prices:

• Aurobindo Pharma: Fell over 3%, trading around ₹1,147
• Lupin: Declined nearly 3%, trading at ₹1,925
• Dr Reddy's Laboratories: Dropped over 1.6%
• Zydus Lifesciences: Down 1.6%
• Granules, Sun Pharma, Cipla, Torrent Pharma: Slid by more than 1% each
• Ajanta Pharma, Laurus Labs, Glenmark Pharma: Registered losses above 0.6%
• Biocon, Alkem Labs: Also traded in the red, though losses were marginal

In contrast, Divi's Labs, Mankind Pharma, Natco Pharma, IPCA Labs, Gland Pharma, and Abbott India remained in the green.

The pharma sector derives a substantial part of its revenue from exports to the US, and the increased import tariffs are feared to squeeze profit margins for many companies.

Summary of the Article

The announcement of new US import tariffs has sparked widespread concern in the Indian pharmaceutical market. Key players such as Aurobindo Pharma, Lupin, Dr Reddy's Laboratories, Zydus Lifesciences, Granules, Sun Pharma, Cipla, Torrent Pharma, Ajanta Pharma, Laurus Labs, and Glenmark Pharma saw their share prices face significant pressure, with many stocks sliding up to 3%.

As India continues trade negotiations with the US, the possibility of further tariff-related measures looms. This uncertainty has dampened investor sentiment, pushing the Nifty Pharma index into the red for a second consecutive session.

With a heavy reliance on US exports, Indian pharmaceutical firms now face tighter margins and increasing volatility in the near term.