Date: November 12, 2026

Financial Results (Standalone & Consolidated)

Q2 FY27 Performance:

  • Revenue from operations: ₹576 crores vs ₹412 crores in Q2 FY26 (40% YoY growth)
  • Operating pre-R&D EBITDA: ₹206 crores vs ₹141 crores in Q2 FY26
  • Pre-R&D EBITDA margin: 35.8% vs 34.1% in Q2 FY26
  • R&D expense: ₹62 crores (10.8% of revenue)
  • Operating EBITDA: ₹144 crores vs ₹94 crores in Q2 FY26 (53% growth)
  • Total EBITDA (including other income): ₹146 crores vs ₹95 crores in Q2 FY26 (54% growth)
  • PAT: ₹90 crores vs ₹54 crores in Q2 FY26 (67% growth)
  • EPS: ₹5.41 vs ₹3.47 in Q2 FY26

H1 FY27 Performance:

  • Revenue: ₹1,111 crores (45% growth YoY)
  • Pre-R&D EBITDA: ₹394 crores (35.4% margin)
  • Operating EBITDA: ₹273 crores (57.5% growth YoY)
  • PAT: ₹175 crores (80% growth YoY)

Balance Sheet Highlights (as of September 30, 2026):

  • Net working capital: 117 days (improved from 126 days, expected to normalize to 125-130 days)
  • ROACE: 36% (same as March 2026)
  • Approximately ₹400 crores (over 25% of capital employed) allocated to pre-revenue assets: Pithampur facility, Chhatrapati Sambhajinagar (Aurangabad) facility, and New Jersey facility

Cash Flow Statement (H1 FY27):

  • Net cash flow from operations: ₹99 crores
  • Cash flow from investing activities: ₹172 crores (primarily for Arinna Lifesciences acquisition, New Jersey facility acquisition, and capex)
  • New Jersey facility: ₹29 crores cash payout, ₹55 crores non-cash right-of-use

Business Update

Revenue Performance:

  • 40% YoY revenue growth with well-balanced growth across products
  • Top 5 and top 10 products showing range-bound performance across sequential quarters
  • Sequential USD revenue growth of 5% in Q2 FY27
  • Pricing remains stable driven by focus on specialty/differentiated products
  • Specialty contribution to gross profit: 36%

Guidance Update:

  • Operating EBITDA margin guidance increased to 24%+ for full year FY27 (from 23%+ previously)
  • Strong visibility for coming quarters

Regulatory Inspections:

  • R&D Facilities: Canada site inspected earlier in 2026 with no observations; Thane headquarters inspected March 2025
  • Manufacturing Facilities:
  • New Jersey: FDA inspected May 2026, EIR in place
  • Ambernath: Unannounced inspection in October 2026 - 3 observations on systems improvement, 2 on product application (all procedural, no data integrity issues)
  • Satara: Unannounced inspection in October 2026 - 1 procedural observation, response submitted, EIR awaited
  • Pithampur: Inspected July 2026 - 2 observations, response submitted same month, EIR awaited
  • All four manufacturing locations inspected within last six months

R&D Analysis

Historical R&D Spending:

  • FY2021: ₹95 crores (30% of revenue)
  • FY2022: ₹124 crores (40% of revenue)
  • Normalized to 10-11% of operating revenue range currently
  • FY2024: ₹107 crores
  • FY2026: ₹194 crores
  • H1 FY27: ₹120 crores (10.8% of consolidated operating revenues)
  • All R&D expenses charged to P&L

R&D Productivity Analysis (3-year horizon):

  • FY2021 to FY2024: ₹165 crores R&D spent → ₹540 crores incremental revenue (3.3x productivity)
  • FY2022 to FY2025: ₹238 crores R&D spent → ₹969 crores incremental revenue (4.1x productivity)
  • FY2023 to FY2026: ₹226 crores R&D spent → ₹1,337 crores incremental revenue (5.9x productivity)
  • FY2024 to FY2027: ₹218.7 crores R&D spent → projected ₹1,266 crores incremental revenue (5.8x productivity, based on annualized H1 revenue excluding Arinna)

Future R&D Guidance:

  • R&D spend guidance of ₹500 crores for 2026, 2027, and Q1 2028
  • ₹313 crores already completed over six quarters
  • Good visibility for remaining ₹187 crores over next three quarters
  • Reference periods for future cycles show materially higher R&D spends already completed:
  • FY2025 vs FY2028: ₹275 crores R&D completed
  • FY2026 vs FY2029: ₹384 crores R&D completed

Facility Updates

Non-Revenue Generating Facilities:

  • Pithampur facility: Expected operationalization FY2028 onwards
  • Chhatrapati Sambhajinagar (Aurangabad) facility: No exact timeline provided
  • New Jersey facility: Requires filing, product placement, and FDA inspection before revenue generation
  • All pre-operational expenses routed through P&L

Arinna Lifesciences Integration

  • Revenue contribution: ₹19.4 crores included in Q2 FY27
  • EBITDA contribution: Not material in both quarters
  • Current focus: Investing behind growth and getting growth back on track
  • Next phase: Beating IPM growth before focusing on profitability
  • Early days for the business

Q&A Highlights

R&D Efficiency:

  • Rigorous stage-gated approach to R&D spending
  • Non-productive R&D spend kept to minimum
  • Increasing R&D productivity reflects continuous improvement
  • Productivity improvement due to both higher revenue per molecule and increased efficiency
  • Portfolio evolution from simpler products to drug-device combinations with larger opportunities

Margin Expansion Drivers:

  • Combination of factors: specialty products contribution, operating leverage, product market share gains
  • Tactical measures affecting sequential revenue growth mostly completed
  • Improved margins after factoring in geopolitical situation costs