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The IPM growth in Mar’23 was at 19%YoY (4Q at ~16%) driven by higher AI sales and low base effect. 3Y CAGR remains healthy at 13%YoY (~11% for 4Q). Volume growth for MAT Mar’23 is flat YoY and we expect it to be positive hereon. Acute therapies with 22%YoY growth outperformed chronic therapies by 7%. All the top therapies reported positive growth primarily led by AI (+50%) and Respiratory (+49%) followed by Oncology (+24%) and Pain (+22%). Top performers in the listed universe were JB Pharma (+35%), FDC (+34%), Alkem (+33%), Alembic (+28%), Cipla (+25%) and Ipca (+25%). Our coverage outperformers were Alembic, Cipla and IPCA while nearly in-line growth was reported by ZYDUSLIF. Cipla’s domestic growth is trending ahead of our expectations in their seasonally weak 4Q. Among domestic MNCs, GSK was the top performer with +20%YoY growth. Among key brands, ZYDUSLIF’s Lipaglyn (+40%) continues to report stellar growth. Reported growth of companies will reflect downward price revision impact for drugs under DPCO (~19% of IPM) albeit to be offset by WPI linked price increases (~12%) in Apr’23. 3Y CAGR for IPM MAT Mar’23 value growth was 10%. We believe price growth of 7-8%, NI of ~2% and volume growth of 2-4% will drive FY24 IPM growth to early/mid double digits.

? Healthy growth led by acute: Based on Mar’23 MAT IPM data, Sun retained its top spot with 8% market share (ms). In Mar’23, Sanofi improved its rank by 1 to 20th position. From our coverage, ALPM, Cipla and IPCA outperformed the IPM growing 28%/25%/25%YoY respectively. Cipla’s growth is trending ahead of our expectations. Others also grew in healthy double digits. JB Pharma continues its strong momentum growing 35%YoY in Mar’23. Among MNCs, GSK outperformed the IPM with 20%YoY growth while Abbott reported growth in line with IPM.

* Price and NI sustaining positive IPM growth, volumes to normalise hereon: IPM growth of 7.8% based on MAT Mar’23 was driven by price growth of 5.4%, NI growth of 2.3% and marginal volume growth of 0.1%. Volumes in Mar’23 grew 14%YoY trending at ~8%YoY in 4Q. We expect normalised positive volume growth hereon. Respiratory, AI and Pain volumes surged 46%/38%/21% YoY respectively in Mar’23 while Derma and Neuro growth was negative at -6%/-1% YoY respectively. We observe positive volume growth across most of the listed universe as base reset is nearly complete. We caution against recent NLEM price revision impact on growth. WPI linked price increases wef Apr’23 of ~12% will benefit the drugs under NLEM in FY24 thereby offsetting the 4Qe price revision setback. Overall, we expect early double digit growth for IPM in FY24.

* All therapies remain in positive territory: While chronic therapies reported ~15%YoY growth in 4Q, acute therapies reported ~16% driven by seasonality towards the latter half of this quarter. Therapy growth in Mar’23 was led by Respiratory, AI, Pain, Oncology and GI whilst Derma and Anti-diabetic continued to lag. In the Anti-diabetic segment, Eris and Abbott outperformed the industry by growing 27%/15%YoY. Ipca reported 29%YoY growth in Mar’23 outperforming therapy growth and we expect this to continue led by robust growth in Zerodol franchise. Sun’s growth in Gynaec has been soft as was alluded by the management. Sun’s growth in cardiac has been in double digits consistently outperforming the market. While Derma growth remains tepid, TRP has consistently outperformed the segment by growing in double digits consistently.

* Mar’23 Top brands performance: Abbott’s key brands (Thyronorm, Udiliv, Rhyzodeg) grew 20%+YoY. Cipla’s respiratory brands (foracort, Duolin, Budecort) reported stellar growth. Mankind’s Manforce brand reported 55% growth in Mar’23 as well as 4Q. Torrent’s 13% growth was across brands. Zydus’ Lipaglyn grew 41%YoY yet again. IPCA’s Zerodol franchise continues to report healthy double digit growth. Alembic’s Azithral sales grew 114%YoY due to seasonality. GLXO’s Augmentin reported a whopping 45%YoY growth while Calpol reported 106%YoY growth. While DRRD’s Cidmus reported flat growth YoY, JB Pharma’s Azmarda grew 26%YoY in Mar’23.

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