Best Pharma Stocks in India

(The stocks mentioned in the blog are as per Market Capitalisation)

India hosts some of the world’s largest pharmaceutical companies, known for their robust reputation in the mass production of generic medications. The produced medications are utilised worldwide to treat various illnesses.

The country leads in generic drug manufacturing, accounting for 20% of global volume and meeting about 60% of global vaccine demand.

Pharma Industry in India - A Brief Overview

Renowned for its affordable vaccines and generic medications, the industry’s product segments include generic drugs, vaccines, over-the-counter medications and more.

Its domestic pharmaceutical industry comprises 3,000 drug companies and around 10,500 manufacturing units. Additionally, India exports pharmaceutical products to North America, Africa, the Caribbean, the Middle East, Asia and other European regions. 

Moreover, the Government of India has implemented several initiatives to strengthen the pharmaceutical sector, including the Pradhan Mantri Bhartiya Janaushadhi Pariyojana (PMBJP), the Production-Linked Incentive (PLI) Scheme for Pharmaceuticals, the Promotion of Bulk Drug Parks Scheme, the Pharmaceutical Technology Upgradation Assistance Scheme (PTUAS), and others. 

The Indian pharmaceutical industry's exports stood at approximately ₹2.51 lakh crore (US$30.47 billion) for FY2024-25, marking year-on-year growth of 9.4% as per the Pharmaceutical Export Promotion Council of India (PHARMEXCIL) report.

150+ countries now have access to high-quality Indian pharmaceuticals, with the market size estimated at ₹4.95 lakh crore (US$60 billion) and expected to grow with rising demand.

The anticipated revenue growth is 7-9% per ICRA reports for FY2026, while IBEF forecasts the market size to cross $65 million soon due to robust domestic growth. There will be an increasing shift towards chronic therapies, value-based care, speciality care, and preventive care for the domestic population. 

The Government’s PLI schemes and the allocation of ₹5,268 crore for the pharma sector in the Union Budget for 2025-26 (inclusive of bulk drug park funding) should further boost the sector. 

Top Pharma Stocks in India in 2026 as per Market Capitalisation

The following table mentions the top pharma stocks in India as per market capitalisation:

*Our stock selection criteria for top stocks based on Market Capitalisation are mentioned at the bottom of this blog.

Overview of Best Pharma Stocks in India as per Market Capitalisation

Here is a comprehensive overview of the pharma sector stocks in India for 2026 as per market capitalisation:

1) Sun Pharmaceutical Industries

Established in 1983, Sun Pharmaceutical Industries Limited has emerged to become one of the largest generic pharmaceutical companies worldwide. Ranked as the fourth largest speciality generic pharmaceutical company globally, Sun Pharma operates 43 manufacturing facilities.

It supplies high-quality and affordable medicines to over 100 countries. The company manufactures and markets a diverse range of pharmaceutical formulations covering various chronic and acute therapies, including generics, branded generics, speciality products, and complex technology-intensive products. Its extensive portfolio comprises more than 2,000 molecules across multiple dosage forms, including liquids, tablets, capsules, ointments, creams, injectables, and inhalers.

Sun Pharma sells over 30 billion doses annually, catering to a wide range of therapeutic areas including gastroenterology, nephrology, neuro-psychiatry, urology, cardiology, oncology, anti-infectives, diabetology, ophthalmology, dermatology and respiratory health. The company’s major markets are present in Western Europe, Australia, Japan, New Zealand, Canada and China.

2) Divis Labs

Divi’s Laboratories is a well-known pharmaceutical company in India that specialises in manufacturing APIs (active pharmaceutical ingredients), nutraceuticals and intermediates. It is also known for its robust global export operations, with its market capitalisation crossing ₹1.77 trillion by late-2025 and early-2026.

The company primarily looks at producing generic APIs and also undertakes contract manufacturing for leading pharmaceutical majors worldwide. It is ranked among the top 3 global API manufacturers, supplying its products to 100+ countries, including Europe and North America. 

It also has three highly advanced manufacturing facilities in Hyderabad and Visakhapatnam, with approvals and inspections from leading authorities such as the EU GMP, US FDA, and Health Canada. The company is listed publicly on the Bombay Stock Exchange and the National Stock Exchange.

For the fiscal year ending in March 2025, the company's revenues stood at ₹9,360 crore, with a net profit of ₹2,191 crore and an operating profit margin (OPM) of 32%. 

3) Torrent Pharma 

Torrent Pharma is one of the most reputed pharmaceutical players in the Indian market and is a part of the bigger Torrent Group. The company specialises in therapeutic categories such as central nervous system (CNS), cardiovascular (CV), and gastrointestinal (GI), with a presence in 40 countries worldwide.

It is highly ranked in countries such as Germany and Brazil, and its turnover in FY2025 exceeded ₹11,500 crore. The company also has 16,000 employees and focuses more on branded generics with a robust R&D operation. 

It is the flagship entity of the Torrent Group, which has business interests in gas, power and other verticals. The company also focuses on segments like women’s healthcare, cosmo-dermatology, VMN, oncology, diabetology and pain management. It also has a major presence in Europe and the USA, while operating its cutting-edge R&D centre in Ahmedabad.

The company has also grown significantly through strategic acquisitions, including Elder Pharma’s businesses in India and Nepal, Curatio Healthcare, and Heumann Pharma (Pfizer). 

4) Cipla Ltd

Cipla Ltd. is one of the foremost Indian and global pharmaceutical firms, established in 1935 by the visionary Dr. K.A. Hamied. The company focuses on enabling healthcare accessibility by producing more affordable generics, particularly in categories such as urology, antiretroviral, and respiratory.

With its headquarters in Mumbai, the company operates in more than 80 countries, has an extensive product portfolio, robust R&D operations, and multiple manufacturing facilities. It has a strong presence throughout numerous markets across India, North America and South Africa. In FY24, the company posted revenues of approximately ₹25,455 crore (US$3.06 billion). 

The company has a portfolio of more than 1,500 products and is the second-largest in the South African prescription market. It has more than 30,000 employees and operates in segments such as cardiology, complex generics, urology, and anti-retrovirals (leading AIDS/HIV supplier).

The company’s R&D focus areas include drug delivery systems, such as inhalers, new formulations, and Active Pharmaceutical Ingredients (APIs). 

5) Dr Reddys Labs

Dr Reddy’s Laboratories is a leading global pharmaceutical company based in Hyderabad. It mainly focuses on affordable medicines and operates across segments such as generics, APIs (Active Pharmaceutical Ingredients), biosimilars, and proprietary products in vital segments like GI, oncology, and pain management.

The company has a leading presence across Russia, Europe, India, and the USA, while staying true to its mission of Good Health Can’t Wait. The company is also aiming at positively impact the lives of 1.5 billion people by the year 2030 with a strong focus on access and innovation. 

It was founded by Dr K. Anji Reddy in 1984 with a core mission of affordability, innovation and access. Some of its core therapeutic areas include cardiovascular, gastrointestinal, oncology, diabetology, dermatology and pain management. The company earned $3.9 billion in revenue as of March 2025 and has more than 13,000 employees.

The product portfolio comprises 300+ products in India alone, across multiple formulations, including biosimilars, generics, and APIs. Its core strength includes its integrated model spanning APIs to finished formulations. It also has an Aurigene Discovery subsidiary that focuses on innovation in the novel therapeutics category.

The company is also committed to sustainability through various initiatives in areas such as waste reduction, water conservation, and renewable energy. 

Factors to Consider Before Investing in Pharma Stocks in India

Before buying pharma sector stocks in India, you should keep in mind the following factors:

• Infrastructure
  

Evaluate the healthcare infrastructure in India, as it directly impacts the pharmaceutical industry. The expanding healthcare infrastructure, combined with increasing demand for healthcare services and products, presents growth opportunities for pharmaceutical companies.

• Demand
  

The demand for pharmaceuticals is influenced by factors such as ageing populations, rising healthcare spending, and increasing disease prevalence. Assess both current and future demand for pharma stocks to identify their growth potential.

• Competition and Mergers
  

The pharma industry is highly competitive, and companies may engage in mergers and acquisitions to stay ahead. To understand how strong a company is, look at where it stands in the market, its growth, and check if its stock prices have changed recently.

• Research and Development
  

Pharmaceutical companies heavily rely on research and development (R&D) to create new drugs and treatments. You must evaluate a company's R&D investments and pipeline to ensure they are focused on the right areas and that promising new products are in development.

• Government Policies
  

The pharmaceutical industry is subject to stringent regulations and government policies that can affect a company's ability to introduce new products. Therefore, you should stay up to date on regulatory changes that could affect the industry and individual companies.

Should You Invest in Pharma Stocks?

While pharmaceutical stocks offer steady returns and growth potential, driven by factors such as rising demand and increased insurance penetration, it is essential to recognise the associated risks.

Regulatory changes, particularly in pricing and export policies, can significantly impact a company's revenues. The US market, pivotal for many pharmaceutical firms, faces regulatory pressures and FDA inspections that could adversely affect stock performance. Additionally, currency fluctuations pose a risk, given the industry's reliance on exports. 

Despite these challenges, pharmaceutical companies are focusing on growth areas and investing heavily in research and development. However, before buying top pharma shares, it is essential to conduct thorough research and consider your investment goals and risk tolerance to make informed investment decisions. 

The Bottom Line 

Investing in pharma sector stocks might offer stable returns and growth prospects, provided thorough due diligence is conducted before investment. If you find conducting independent research challenging, seeking guidance and advice tailored to your investment objectives from a financial expert is in your best interest.