Management Commentary

Dr. Sachin Patel, Managing Director, commented on the results:

  • FY27 commenced with healthy business momentum with standalone revenue growing 12% YoY in Q2 FY27 and 17% during H1 FY27
  • Growth supported by strong volume momentum and favorable shift in product mix towards APIs
  • New fermentation facility commissioned during the quarter, marking important milestone in manufacturing capabilities
  • Commissioning phase had near-term impact on operating margins, with benefits expected from Q4 FY27 onwards
  • Acquisition of MicroBiopharm Japan provides opportunity to expand capabilities in anti-infectives and fermentation space
  • H1 FY27 revenue stood at ₹91 crore while EBITDA increased 11% YoY to ₹39 crore
  • Strategic priorities centered around precision fermentation, bioconversion, gene therapy, anti-infectives and biopeptides

Quarterly Financial Performance (Standalone)

Q2 FY27 Financial Highlights (₹ crore):

  • Income from Operations: ₹47.5 (vs ₹42.3 in Q2 FY26, +12.1% YoY)
  • Total Income from Operations: ₹47.5
  • Cost of Materials Consumed: ₹6.9
  • Changes In Inventory: ₹3.9
  • Employee Cost: ₹3.8
  • Other Cost: ₹15.1
  • Total Expenditure: ₹29.7
  • EBITDA: ₹17.7 (vs ₹20.9 in Q2 FY26, -15.3%)
  • EBITDA Margin: 37.4% (vs 49.5% in Q2 FY26, -1,210 bps)
  • Other Income: ₹3.7
  • Depreciation: ₹4.0
  • Interest: ₹6.4
  • Profit Before Tax: ₹11.1 (vs ₹18.8 in Q2 FY26, -41.1%)
  • Tax: ₹2.6
  • Profit After Tax: ₹8.5 (vs ₹14.3 in Q2 FY26, -40.6%)
  • PAT Margin: 17.8% (vs 33.7% in Q2 FY26, -1,584 bps)
  • EPS: ₹0.65 (vs ₹1.31 in Q2 FY26)

Half Yearly Financial Performance (Standalone)

H1 FY27 Financial Highlights (₹ crore):

  • Income from Operations: ₹91.2 (vs ₹78.2 in H1 FY26, +16.7% YoY)
  • Total Income from Operations: ₹91.2
  • Cost of Materials Consumed: ₹14.6
  • Changes In Inventory: ₹0.0
  • Employee Cost: ₹8.5
  • Other Cost: ₹29.6
  • Total Expenditure: ₹52.7
  • EBITDA: ₹38.5 (vs ₹34.9 in H1 FY26, +10.5%)
  • EBITDA Margin: 42.2% (vs 44.6% in H1 FY26, -235 bps)
  • Other Income: ₹3.8
  • Depreciation: ₹8.0
  • Interest: ₹8.1
  • Profit Before Tax: ₹26.2 (vs ₹30.9 in H1 FY26, -15.1%)
  • Tax: ₹6.7
  • Profit After Tax: ₹19.5 (vs ₹23.3 in H1 FY26, -16.3%)
  • PAT Margin: 21.4% (vs 29.8% in H1 FY26, -841 bps)
  • EPS: ₹1.50 (vs ₹2.14 in H1 FY26)

Consolidated Financial Performance

Q2 FY27 Consolidated (₹ crore):

  • Income from Operations: ₹49.9
  • Total Income from Operations: ₹49.9
  • EBITDA: -₹0.9
  • EBITDA Margin: -1.8%
  • Profit After Tax: -₹13.8
  • PAT Margin: -27.7%
  • EPS: -₹1.06

H1 FY27 Consolidated (₹ crore):

  • Income from Operations: ₹93.7
  • Total Income from Operations: ₹93.7
  • EBITDA: ₹19.9
  • EBITDA Margin: 21.2%
  • Profit After Tax: -₹2.8
  • PAT Margin: -3.0%
  • EPS: -₹0.21

Adverse impacts on consolidated performance due to:

  • Foreign Exchange Losses: Extraordinary unrealized foreign currency translation losses of ₹15.57 crore
  • Partial-Period Consolidation: Only 13 days of revenue consolidated from MBJ post-acquisition completion on September 18, 2026
  • Exceptional Expenses: One-off earthquake-related operational expenses of ₹1.2 crore at MBJ

Strategic Acquisitions

MicroBiopharm Japan Co., Ltd. Acquisition:

  • Deal Value: JPY 21.5 Bn (~₹1,300 crore)
  • Stake Acquired: 100% via wholly owned SPV in Japan
  • Seller: T Capital Partners (Japan-based PE Fund)
  • Completion: Q2 FY2027
  • MBJ FY26 Revenue: JPY 9.5 Bn (₹557 crore)
  • Strategic Benefits: Expanded portfolio across oncology, immunosuppressants, peptides; serving Top 6 global pharma customers for 20+ years; proprietary P450 enzyme library, Plasmid DNA, ADC Conjugation technologies

Sanofi Product Portfolio Acquisition:

  • Deal Value: ~€158 million (funded via debt & equity mix)
  • Portfolio Revenue: ~€62 million (FY 2025 actuals)
  • Brands Acquired: 13 established global brands
  • Geographic Reach: 55+ countries (Europe, MEA & other markets)
  • Therapeutic Focus: Tuberculosis & anti-infectives including Levofloxacin, Rifampicin & Rifapentine (WHO Essential & EU Critical Medicines)
  • Retail Contribution: ~70% of revenue
  • Structure: Asset acquisition (Brands + MAs + Dossiers + Inventory) - no manufacturing capex or employee transfer

Product Portfolio & Capabilities

Current Product Portfolio:

  • Intermediaries: Rifamycin (for Rifampicin and Rifaximin), Rifamycin O
  • Anti-Tuberculosis API: Rifampicin, Rifapentine
  • Gastrointestinal API: Non-absorbable antibiotic
  • Fermentation Capacities: Up to 990 KL

Expansion Strategy

  • Capex: Expanding fermentation capacity for new products
  • Research & Development: R&D Unit commissioned as per international standards; developing new intermediate molecules
  • Forward Integration: Commercial operations started at new API unit; leveraging expertise in Rifa-based products
  • Inorganic Expansion: Exploring global opportunities for geographical and therapy area expansion

Manufacturing & ESG Initiatives

  • State-of-art manufacturing facilities at Vapi, Gujarat
  • Environment friendly aerobic bacteria fermentation process
  • Hybrid Renewable Power Project: Wind-solar configuration for captive consumption to reduce carbon footprint and optimize power costs

Balance Sheet Highlights (Standalone)

As on 30th September 2026 (₹ crore):

  • Total Equity & Liabilities: ₹1,893.4
  • Shareholders Funds: ₹1,055.3
  • Share Capital: ₹13.0
  • Reserve & Surplus: ₹1,042.3
  • Non Current Liabilities: ₹720.1
  • Borrowings: ₹709.7
  • Current Liabilities: ₹118.0
  • Total Assets: ₹1,893.4
  • Non Current Assets: ₹1,704.0
  • Property Plant & Equipment: ₹280.1
  • Capital work in progress: ₹173.7
  • Current Assets: ₹189.4
  • Inventories: ₹17.9
  • Trade receivables: ₹70.8
  • Cash & Cash equivalents: ₹80.6