Market Report on Indian Pharmaceuticals and Healthcare

Pharmaceutical firms continue to post varying results in India due to the government’s
introduction of policies targeting the pharmaceutical industry. These include patent disrespect and price containmentpolicies for both generic and patented drugs. We maintain our bearish view on the sector andhighlight that domestic firms with a large exposure to overseas markets will continue to fare well.
Headline Expenditure Projections

Pharmaceuticals: INR840.0bn (US$15.7bn) in 2012 to INR921.2bn (US$16.5bn) in 2013; +9.7% in local
currency terms and +4.6% in US dollar terms. Forecast broadly in line with Q313, although growth in
US dollar terms was impacted by the depreciation of the rupee.

Healthcare: INR3,811.2bn (US$71.3bn) in 2012 to INR4,209.7bn (US$75.2bn) in 2013; +10.5% in local
currency terms and 5.4% in US dollar terms. Forecast broadly in line with Q313, although growth in US
dollar terms was impacted by the depreciation of the rupee.