KARACHI: Pakistan’s listed pharmaceutical sector recorded profits of Rs11.6 billion in the first quarter of FY27, up 11 percent year-on-year (YoY) and 54 percent quarter-on-quarter (QoQ), mainly driven by higher sales and improved gross margins, according to a report by Topline Research.
Despite the earnings growth, the sector’s market capitalisation declined 24 percent YoY and 13 percent QoQ to Rs505.2 billion.
The sector’s net sales increased 5 percent YoY and 11 percent QoQ to Rs98.8 billion in 1QFY27. Topline Research attributed the increase mainly to a combination of price and volume growth. The sales increase was recorded despite a higher base in 1QFY26, which included exports to Afghanistan, while exports to the country have remained suspended since October 2025.
Abbott Laboratories Pakistan Limited (ABOT) accounted for 21 percent of sector sales during the quarter, followed by GlaxoSmithKline Pakistan Limited (GLAXO) at 17 percent, The Searle Company Limited (SEARL) at 11 percent and Haleon Pakistan Limited (HALEON) at 10 percent.
The sector’s quarterly gross margin improved to 43.7 percent in 1QFY27, compared with 41.9 percent in 1QFY26 and 42.8 percent in 4QFY26. The report attributed the improvement to higher volumes and prices.
AGP Limited (AGP) recorded the highest gross margin at 64.6 percent, followed by SEARL at 57.2 percent and Hinoon Laboratories Limited (HINOON) at 57.1 percent in 1QFY27.
Selling and distribution expenses for the sector increased 6 percent YoY and 5 percent QoQ to Rs18.6 billion during the quarter. Administrative expenses rose 14 percent YoY and 5 percent QoQ to Rs3.6 billion.
The sector’s finance costs increased 22 percent YoY and 44 percent QoQ to Rs1.1 billion in 1QFY27. Higher finance costs at GLAXO, AGP and HALEON contributed to the increase.
Other income declined 15 percent YoY and 69 percent QoQ to Rs802 million during the quarter, mainly due to lower contributions from Hoechst Pakistan Limited (HPL), GLAXO and SEARL.
The sector’s effective tax rate stood at 37.9 percent in 1QFY27, compared with 39.4 percent in 1QFY26 and 50.4 percent in 4QFY26. In absolute terms, the sector’s tax charge amounted to Rs7.1 billion during the quarter.
Looking ahead, analysts expect overall pharmaceutical sector volumes to improve, supported by a low base, new product launches and higher seasonal demand during the winter season.
Copyright Business Recorder, 2026
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