Alkem and Zydus Share Price Rally: Nifty Pharma Index Gains 1.9%

Market Performance

The Nifty Pharma Index rose 1.9% during intraday trades on Wednesday, marking a strong relief rally in the Indian stock market.

• Opening level: 21,803.45
• Previous close: 21,753.50
• Intraday high: 22,171.05

Leading the gains were Alkem Laboratories, Zydus Lifesciences, Laurus Labs, and Abbott India, which drove the Nifty Pharma Index higher by almost 2%.

Main News

Shares of Alkem and Zydus were among the top gainers in the pharmaceutical sector amid the intraday rally. The movement comes as the market reacts to ongoing global and domestic developments in the pharma industry.

While the rally reflects positive sentiment, the US pharmaceutical market remains a key factor for Indian pharma companies. Many players, including Sun Pharmaceuticals, Lupin, Dr. Reddy's, and Aurobindo, derive 30–50% of revenues from the US, making them sensitive to potential trade regulations and tariffs.

Company Details

Alkem Laboratories

Alkem has been performing steadily, contributing significantly to the Nifty Pharma rally. The company benefits from its strong presence in domestic and international markets, including generics exports to the US.

Zydus Lifesciences

Zydus Lifesciences also recorded gains during Wednesday’s trade. The company continues to leverage cost-competitiveness and a diverse product portfolio, which supports steady performance amid global uncertainties.

Industry Context

• The domestic Indian pharma market accounts for 50% of overall sector revenue and remains largely unaffected by US tariff concerns.
• Indian pharma companies are cost-competitive, helping to mitigate risks from international market volatility.
• Generic drug segments dominate US revenues, and any potential tariffs could influence production strategies and profitability.

Financial Overview of Nifty Pharma

• Sector P/E (1-year forward): 29.7x
• 10-year average P/E: 26.7x

Despite tariff uncertainties, the sector valuations remain elevated above long-term averages, indicating investor confidence in leading pharmaceutical companies like Alkem and Zydus.

Summary

• Nifty Pharma Index surged 1.9% intraday
• Alkem and Zydus led the gains in the pharma sector
• US market developments, including potential tariffs, continue to influence Indian pharma stocks
• Domestic market stability and cost-competitiveness remain a strong support for Indian pharma

The Alkem and Zydus share price movements highlight resilience in the pharma sector, even amid global uncertainties.