Aarti Drugs Q2 FY27 Revenue Up 27% YoY

Financial Highlights (Consolidated)

Q2 FY27 Performance

Net Revenue from Operations: ₹826.2 crore (27% YoY growth from ₹652.8 crore in Q2 FY26)
Other Income: ₹2.5 crore
Total Revenue: ₹828.8 crore
COGS: ₹499.1 crore
Gross Profit: ₹329.7 crore (35% YoY growth)
Gross Margin: 39.9% (240 bps improvement YoY)
Employee Expenses: ₹37.1 crore
Other Expenses: ₹154.7 crore
EBITDA: ₹137.9 crore (63% YoY growth)
EBITDA Margin: 16.6% (370 bps improvement YoY)
Finance Costs: ₹9.6 crore
Depreciation: ₹19.0 crore
PBT: ₹109.3 crore (81% YoY growth)
PBT Margin: 13.2% (390 bps improvement YoY)
Taxes: ₹26.5 crore
Profit After Tax: ₹82.8 crore (83% YoY growth)
PAT Margin: 10.0% (310 bps improvement YoY)
Earnings Per Share (EPS): ₹9.07

H1 FY27 Performance

Net Revenue from Operations: ₹1,529.0 crore (23% YoY growth from ₹1,243.3 crore)
Other Income: ₹3.4 crore
Total Revenue: ₹1,532.4 crore
COGS: ₹926.7 crore
Gross Profit: ₹605.7 crore (31% YoY growth)
Gross Margin: 39.6% (240 bps improvement YoY)
Employee Expenses: ₹73.6 crore
Other Expenses: ₹297.2 crore
EBITDA: ₹234.8 crore (48% YoY growth)
EBITDA Margin: 15.3% (250 bps improvement YoY)
Finance Costs: ₹18.9 crore
Depreciation: ₹37.5 crore
PBT: ₹178.5 crore (60% YoY growth)
PBT Margin: 11.7% (270 bps improvement YoY)
Taxes: ₹45.6 crore
Profit After Tax: ₹132.9 crore (34% YoY growth)
PAT Margin: 8.7% (70 bps improvement YoY)
Earnings Per Share (EPS): ₹14.56

Balance Sheet Position (as of September 30, 2026)

Equities & Liabilities

Equity Share Capital: ₹91.3 crore (unchanged from March 2026)
Other Equity: ₹1,590.3 crore (up from ₹1,457.6 crore)
Total Equity: ₹1,681.7 crore
Borrowings (Non-current): ₹239.5 crore
Lease Liabilities (Non-current): ₹0.2 crore
Other Financial Liabilities (Non-current): ₹0.3 crore
Deferred Tax Liabilities: ₹83.9 crore
Total Non-Current Liabilities: ₹328.4 crore
Borrowings (Current): ₹379.1 crore
Lease Liabilities (Current): ₹0.8 crore
Trade Payables: ₹498.5 crore
Other Financial Liabilities (Current): ₹13.2 crore
Current Tax Liabilities: ₹21.5 crore
Total Current Liabilities: ₹1,043.6 crore
Total Equity and Liabilities: ₹3,053.7 crore

Assets

Property, Plant and Equipment: ₹1,096.1 crore
Capital Work in Progress: ₹235.5 crore
Intangible Assets: ₹16.2 crore
Right to Use Assets: ₹0.9 crore
Investments: ₹27.5 crore
Total Non-Current Assets: ₹1,396.3 crore
Inventories: ₹603.1 crore
Trade Receivables: ₹905.0 crore
Cash and Bank Balances: ₹9.9 crore
Other Financial Assets: ₹15.8 crore
Loans: ₹1.2 crore
Other Current Assets: ₹122.2 crore
Total Current Assets: ₹1,657.4 crore
Total Assets: ₹3,053.7 crore

Cash Flow Statement (H1 FY27)

Net Profit before Tax: ₹178.5 crore
Adjustments for Non-Cash Items: ₹55.9 crore
Operating Profit before Working Capital Changes: ₹234.4 crore
Changes in Working Capital: -₹140.3 crore
Cash Generated from Operations: ₹94.0 crore
Direct Taxes Paid: -₹28.3 crore
Net Cash from Operating Activities: ₹65.7 crore
Net Cash from Investing Activities: -₹90.2 crore
Net Cash from Financing Activities: ₹25.7 crore
Net Increase in Cash: ₹1.2 crore
Cash at Beginning of Period: ₹7.3 crore
Cash at End of Period: ₹8.5 crore

Management Commentary

Mr. Adhish Patil, Managing Director, stated that Q2 FY27 was a landmark quarter with highest-ever revenue and EBITDA. The performance reflected volume growth, strong realizations across API, formulations and specialty chemicals portfolio, and progress in building a more integrated manufacturing platform.

Specialty Chemicals business nearly doubled as the Sayakha facility scaled up, and Formulations business grew 58% led by strong export demand. The Sayakha facility is meeting significant metformin intermediate requirements in-house, enhancing cost competitiveness.

Leadership transition occurred effective October 1, 2026, with Mr. Prakash M. Patil retiring as Chairman, Managing Director and CEO, and Mr. Rashesh Gogri taking over as Chairman while Mr. Adhish Patil became Managing Director.

Business Overview

Manufacturing Capacity

API: 48,204 MTPA across 9 manufacturing units
Formulations: 3 billion tablets + 300 million capsules capacity
Specialty Chemicals: 34,308 MTPA capacity

Regulatory Approvals

UKMHRA/PICS approved
WHO-GMP approved plant in Baddi, Himachal Pradesh
Oncology formulation is USFDA approved

Business Segments

Active Pharmaceuticals Ingredients (API): 50+ molecules across therapeutic categories including antibiotics, antiprotozoals, anti-inflammatories, anti-diabetics, and anti-fungals. Largest global manufacturer of 5 molecules.
Formulations: Diversified in 2014 via wholly owned subsidiary with flexible manufacturing model.
Specialty Chemicals: Backward integrated intermediates for antibiotics, antifungals, anti-inflammatories, and cardiovascular APIs.

Growth Strategies

₹200 crore investment in oncology development and pipeline growth over last 24 months
Developing robust product pipeline for regulated global markets (USFDA, MHRA, EDQM approvals)
Expanding into new geographies with ~330 regulatory filings across 16 targeted markets
Shifting toward specialized chemistry products with premium pricing
Therapeutic expansion beyond traditional APIs into complex medicine categories
₹600 crore capex program completed, boosting capacity and margins

R&D Capabilities

R&D Center at Tarapur: Supports API process development, recognized by DSIR
R&D Center at Turbhe: Develops complex generics for formulation business
R&D Spends (FY26): ₹66 crores
Developed 30+ APIs in last 5 years

Historical Financial Performance

FY26 Consolidated Performance

Net Revenue from Operations: ₹2,565.3 crore
Gross Profit: ₹949.0 crore (37.0% margin)
EBITDA: ₹311.6 crore (12.1% margin)
PBT: ₹210.9 crore
PAT: ₹194.9 crore (7.6% margin)
EPS: ₹21.36

Shareholder Distribution Policy

The company may elect to distribute 15% to 30% of Consolidated Net Profits to shareholders.