Financial Performance Highlights

Q2 FY27 Financials:

  • Total Revenue: ₹2,206 crores (highest quarterly revenue from beginning)
  • Gross Margin: 63%
  • EBITDA: ₹762 crores
  • EBITDA Margin: 34.5% (expanded 2.7 percentage points from previous quarters)
  • Profit After Tax: ₹441 crores

H1 FY27 Financials:

  • Total Revenue: ₹4,233 crores (31% growth YoY)
  • Gross Margin: 62.9%
  • EBITDA: ₹1,406 crores
  • EBITDA Margin: 33.2%
  • Profit After Tax: ₹809 crores
  • ROCE: 22.5% (vs 17.7% in FY26)

Capital Structure & Cash Flow:

  • Net Debt: ₹2,466 crores
  • Debt-to-EBITDA: 1.02x (vs 1.28x previous quarter)
  • H1 Capex: ₹864 crores
  • Q2 Capex: ₹470 crores

Business Segment Performance

CDMO Business (Small Molecules):

  • Q2 Revenue: ₹875 crores (86% growth YoY)
  • H1 Revenue: ₹1,710 crores (77% growth YoY)
  • Driven by successful delivery of critical late-stage programs and commercial API supplies
  • Total reactor volume for small molecules API exceeded 9,000 kiloliters
  • 59 quality audits conducted in H1 with no critical findings

Affordable Medicines:

  • Q2 Revenue: ₹1,302 crores (15% growth YoY)
  • H1 Growth: 13%
  • ARV API: ₹625 crores (Q2)
  • ARV FDF: ₹677 crores (Q2)
  • Stable pricing in both ARV and developed market portfolios
  • Cumulative 92 DMFs filed to date
  • 96 products cumulatively filed in developed market formulation business

Laurus Bio (Fermentation):

  • Q2 Revenue: ₹29 crores
  • H1 Revenue: ₹64 crores
  • Year-over-year variation due to campaign phasing
  • Commercial fermentation facility (Laurus Bio 4) expected operational by end of CY2026

Strategic Developments & Capacity Expansion

Peptide Manufacturing:

  • Commissioned commercial-scale peptide manufacturing block
  • Current SPPS (Solid-Phase Peptide Synthesis) reactor volume: 16,000+ liters
  • Significant further expansions underway
  • Enhanced liquid-phase peptide synthesis capabilities
  • Full integrated API capabilities (synthesis, purification, isolation)
  • Commercial revenues expected around FY29 time frame
  • Validation batches expected in 12-18 months timeframe

Acquisitions & Investments:

1. Galenvs Sciences (Canada): Acquired 60% stake in oligonucleotides and precision magnetic nanoparticles-based purification company

2. SI & C Resins (Hyderabad): Acquired majority stake in peptide resin technology company

  • Both acquisitions aimed at enhancing integrated scientific capabilities and supply security

KRKA Joint Venture:

  • Formulation facility progress on track
  • Phase 1 production blocks scheduled to commence operations mid-2027
  • Focus on high-potent and general OSD manufacturing
  • Meaningful revenues expected in FY28-FY29

R&D and Capability Development

  • R&D-to-Sales Ratio: 4.3% for H1 FY27 (34% increase YoY)
  • Focus on gene therapy and ADC technology infrastructure development
  • Investment in complex chemistry capabilities including:
  • Biocatalysis (commercial scale since 2021)
  • Flow chemistry
  • Flow hydrogenation
  • Fermentation
  • OEB 5 facility for payload linker

Operational Metrics

  • Asset Turnover: Currently 1.0x, targeting 1.1x (6-year average) with peak of 1.4x achievable
  • Capex Guidance: ₹3,000 crores for FY27-FY28 (~₹1,500 crores annually)
  • Continued focus on high-value business segments

Forward-looking Commentary

  • Maintain guidance of 60%+ gross margin and 30%+ EBITDA margin
  • Strong visibility for next 18-24 months across business segments
  • No significant customer concentration issues
  • No anticipated destocking or supply disruptions
  • Supply chain demonstrated exceptional agility despite global volatility