Executive Summary & Financial Highlights

Full-Year Performance (FY26):

  • Consolidated Profit After Tax (PAT) increased by 48% Year-on-Year (YoY) to ₹102 crore. This figure includes the share of profit from an associate company, VKT Pharma.
  • EBITDA margin expanded by 155 basis points (bps) YoY to 19%. This improvement was attributed to successful backward integration initiatives and a favorable product mix.
  • Revenue grew by 13% YoY, supported by growth across key Active Pharmaceutical Ingredients (APIs).
  • The Board has recommended a final dividend of ₹0.40 (40%) per share.
  • A ₹280 crore capital expenditure (Capex) programme is on track and targeted for completion by FY27.

Quarterly Performance (Q4FY26):

  • Revenue stood at ₹237.95 crore, compared to ₹248.20 crore in Q4FY25, a decrease of 4%.
  • Gross Profit was ₹81.29 crore (34% margin), up from ₹76.46 crore (31% margin) in the prior year quarter.
  • EBITDA was ₹39.90 crore (17% margin), slightly down from ₹40.82 crore (16% margin) in Q4FY25.
  • Profit Before Tax (PBT) was ₹27.06 crore, down 5% from ₹28.53 crore in Q4FY25.
  • Reported PAT was ₹20.96 crore, up 4% from ₹20.09 crore.
  • The share of profit from the associate company (VKT Pharma) was ₹11.75 crore, a significant increase from ₹0.23 crore in Q4FY25.
  • PAT after minority interest and associate share was ₹32.71 crore, up 61% from ₹20.32 crore.
  • Earnings Per Share (EPS) for the quarter was ₹3.58, up 49% from ₹2.40.

Operational & Business Overview

Company Profile:

  • SMS Pharma is a global and domestic leader in key products.
  • It has a reactor volume of 120+ KL and has filed 120+ Drug Master Files (DMFs).
  • The company manufactures 55+ APIs across 14 diverse therapeutic segments.
  • It employs over 1,600 people, including 100+ scientists in R&D.
  • 88% of revenue is derived from regulatory markets, and it has a presence in 75+ countries with 800+ customers.

Therapeutic Area Revenue Share (FY26):

  • Anti-inflammatory (High-volume): 20%
  • Anti Retro Viral (ARV) (High-volume): 28%
  • Anti-diabetic (High-value): 15%
  • Anti-migraine (High-value): 11%
  • Anti-ulcer (High-volume): 5%
  • Anti-erectile dysfunction (High-value): 6%
  • Anti-epileptic (High-value): 6%
  • Anti-anginal (High-value): 5%
  • Others (High-value): 4%

The share of high-value products in the portfolio was 47% in FY26.

Manufacturing Facilities:

1. Hyderabad Facility: 48,158 m² area, 120 KL capacity for niche small-volume molecules. Regulatory approvals include USFDA, EUGMP, KFDA, CDSCO, PMDA. Approved six times by USFDA.

2. Vizag Facility: 3,45,007 m² area, 3,000 KL capacity for niche large-volume molecules. Regulatory approvals include USFDA, KFDA, CDSCO, PMDA. Approved four times by USFDA.

Strategic Initiatives:

  • The company has a Joint Venture with Spanish pharma giant Chemo Iberica S.A.
  • It has a strategic focus on R&D, with 35+ process patents and 20 new products added since FY22.
  • The 10-year average Operating Cash Flow (OCF) conversion ratio (OCF/EBITDA) is stated to be on par with leading API companies.

Way Forward & Strategy

Key Growth Drivers:

  • Ramp-up of the high-volume product portfolio, with an aspiration to become the world's #1 player in Anti-inflammatory APIs.
  • Generating additional revenues through the strategic partnership with Chemo.
  • Winning market share in other key APIs.

Backward Integration & Product Portfolio:

  • Continued focus on backward integration to improve the quality of earnings.
  • Target of 20 DMF, CEP, and dossier filings over the next 24 months.
  • Plan to double R&D investment over the next 15 months.

Product Pipeline:

  • Lab Scale Development & Commercial Validation Completed: Anti-inflammatory, Anti-diabetic, Anti-depressant.
  • Lab scale development and validation completed: Anti-hypertensive, Antipsychotic, Ulcerative colitis.

Capex:

  • The current ₹280 crore Capex is oriented towards capacity expansion for existing APIs, building capacities for the new API pipeline, and land acquisition for a greenfield project.
  • The company is focused on asset utilization to deliver best-in-class returns, with the current Capex round targeted to deliver returns in the high-teens range.

Historical Financial Performance (Consolidated)

P&L Statement (₹ Crore):

| Particulars | FY26 | FY25 | YoY % |

| Revenue | 886.87 | 782.75 | 13% |

| COGS | 584.04 | 518.05 | 13% |

| Gross Profit | 302.83 | 264.70 | 14% |

| Gross Margin (%) | 34% | 34% | 0 bps |

| EBITDA | 171.28 | 139.00 | 23% |

| EBITDA Margin (%) | 19% | 18% | 155 bps |

| Finance Costs | 23.08 | 18.54 | 24% |

| PBT | 116.63 | 92.34 | 26% |

| Reported PAT | 87.99 | 74.52 | 18% |

| Share of Associate Profit | 13.99 | 0.23 | 5983% |

| PAT after MI & Assoc | 101.98 | 74.75 | 36% |

| PAT Margin (%) | 11% | 10% | 147 bps |

| EPS | 11.15 | 8.41 | 33% |

Balance Sheet (₹ Crore) - Key Items as of FY26:

  • Total Assets: 1,362.44
  • Property, Plant and Equipment: 531.22
  • Capital Work-in-Progress: 121.64
  • Inventories: 351.20
  • Trade Receivables: 215.87
  • Cash and Cash Equivalents: 45.88
  • Total Equity: 785.81
  • Borrowings (Non-Current + Current): 365.04

Cash Flow Statement (Abridged) (₹ Crore) - FY26:

  • Cash generated from operations: 83.32
  • Cash flow from operating activities: 59.22
  • Capex (Investing Activities): -130.56
  • Net Proceeds from Share Warrants (Financing): 47.62
  • Net increase/decrease in cash: 4.48