Key Financial Performance

Q2 FY27 Performance (Quarter Ended September 30, 2026)

  • Revenue: ₹14,297 million (highest ever quarterly revenue), growing 17% year-on-year and 13% quarter-on-quarter
  • Gross Margin: ₹8,003 million (13% YoY growth), with gross margin percentage at 56.0% (vs 57.8% in Q2 FY26 and 60.9% in Q1 FY27)
  • EBITDA: ₹2,509 million (8% YoY growth), crossing ₹2,500 million milestone for first time
  • EBITDA Margin: 17.6% (vs 19.0% in Q2 FY26 and 18.2% in Q1 FY27)
  • Operational PAT: ₹1,358 million (12% YoY growth)
  • Operational EPS: ₹14.7 (vs ₹13.2 in Q2 FY26)
  • Reported PAT: ₹134 million
  • Reported EPS: ₹14.2 per share
  • Material Costs: Increased to 44% of revenues from 42.2% last year
  • Net Finance Cost: ₹43 million
  • Depreciation & Amortization: ₹57 million
  • EBITDA to Operational PAT Conversion: 54%

H1 FY27 Performance (Half Year Ended September 30, 2026)

  • Revenue: ₹26,950 million (15.1% YoY growth)
  • EBITDA: ₹4,810 million (6.9% YoY growth)
  • EBITDA Margin: 17.8%
  • Operational PAT: ₹2,590 million (9.8% YoY growth)
  • Operational EPS: ₹28.1 per share
  • Reported PAT: ₹3,000 million (26.4% YoY growth, includes gain on Pivot Path divestment recognized in Q1)

Business Segment Performance

Geographic Revenue Mix

  • Ex-US Business: ₹6,963 million in Q2 (31% YoY growth), contributing 49% of total revenue
  • US Business: ₹6,855 million in Q2 (9% YoY growth, 9% QoQ growth), or $73 million
  • H1 Ex-US: ₹12,838 million (24% YoY growth)
  • H1 US: ₹13,137 million (7% YoY growth)

US Business Details

  • ANDAs Filed: 230 as of October 2026
  • ANDAs Approved: 212 covering 154 products
  • Commercialized Products: 75 products (up from 72 in Q1)
  • Top-three Market Positions: 38 products contributing ~70% of US revenues
  • Controlled Substances: 5 commercialized products contributing ~6% of US revenue, addressing $750 million market
  • Pipeline: More than 40 value-accretive products in active pipeline

Ex-US Market Performance

  • UK: Strong prescription business performance with healthy pricing and volume momentum
  • Europe: Strong partnered business performance with higher customer offtake
  • Germany: Private label OTC business growing strongly with wider pharmacy reach
  • Nordics: Strong quarter-on-quarter growth with branded prescription products showing encouraging uptake
  • Australia: Supply output improved meaningfully with new projects agreed with key partners
  • Africa: Stellar growth in Francophone Africa, outpacing underlying market
  • South Africa: Strong momentum in independent pharmacy channel

Strategic Updates and Guidance

FY28 Growth Aspiration Revision

  • US revenue aspiration of $375 million by FY28 now expected beyond FY28
  • Overall growth ambition remains intact with ex-US business accelerating ahead of plan
  • Ex-US revenue reached 102% of US revenue in Q2 FY27 (vs target of matching by FY28)

Growth Strategy Pillars

1. Profitability-led growth with established profitability thresholds

2. Rebalancing growth engines with sharper focus on ex-US markets

3. US remains strategic growth market focused on differentiated platforms

Differentiated Platforms Development

  • Nasal Sprays: Third nasal spray (controlled substance) filed in September 2026
  • First nasal spray has GDUFA goal date in H2 FY27, expected approval in Q4
  • Transdermal Patches: Expected relaunch of controlled-substance patch in Q3 FY27 (from Endo ANDA acquisition)
  • Full-year benefit expected in FY28

Controlled Substances Expansion

  • More than 10 CS products in pipeline across multiple domains
  • Addressable market expected to expand to $4.5 billion (6x current market)
  • Niche products require limited API quota, enabling ramp-up within current allocations
  • Chestnut Ridge facility has required US manufacturing capacity and expertise

Operational Metrics

Working Capital and Cash Flow

  • Cash-to-Cash Cycle: 137 days (up 13 days from March 2026)
  • Working Capital Increase: ₹307 crores during H1
  • ₹174 crores due to 14-day inventory increase from Q4 (geopolitical disruptions)
  • ₹133 crores supporting 15% revenue growth
  • Net Debt-to-EBITDA: 1.72x (₹211 crores increase in net debt during H1)
  • Retained Investment in OneSource: Valued at approximately ₹290 crores

Capital Expenditure

  • H1 Capex and Intangibles: ₹208 crores deployed
  • FY27 Capex Guidance: Approximately ₹300 crores
  • FY28 Capex: Expected to be slightly lower
  • Investments directed at nasal spray, transdermal patch programs, and differentiated pipeline

Return Metrics

  • Trailing 12-month ROCE: 14.4% (remaining in 14-15% range)
  • Expected improvement as growth continues and investments mature

Governance Update

  • New Board Appointment: Mr. Biren Gabhawala joined as Independent Director
  • Chartered Accountant with three decades experience in financial reporting, audit, taxation and corporate governance
  • Former Audit Committee Chair at eClerx Services and 3M India
  • Independent Directors now constitute 6 of 10 Board members

Forward-looking Commentary

  • Expect H2 FY27 to be stronger than H1
  • Expect 4-6 product launches in H2 FY27
  • US business expected to show better performance in H2
  • Ex-US business expected to continue growing faster than company average
  • Focus on preserving gross margins, improving cash-to-cash cycle, and strengthening net debt-to-EBITDA ratio
  • Bottom line expected to accelerate ahead of top line with operating leverage