Granules India (532482) Q1 26/27 earnings summary

Executive summary

• Achieved record Q1 FY27 with 22% year-on-year revenue growth to ₹14,768 million, driven by complex generics and peptide CDMO expansion, and PAT up 60% to ₹1,800 million.

• Complex generics now comprise 50% of finished dosages, up from 39% a year ago, supporting margin expansion to 22.9%.

• Peptide CDMO platform revenues grew over 100% year-on-year, with three new customer projects and infrastructure upgrades underway.

• Regulatory remediation at Gagillapur is nearly complete, with seven of eight facilities carrying a clean EIR; USFDA warning letter remains a risk.

• Strategic focus remains on scaling Genome Valley, expanding complex generics, radiopharmaceuticals, and oncology launches, and deepening the differentiated portfolio.

Financial highlights

• Q1 FY27 consolidated revenue: ₹14,768 million (+22% YoY), PAT: ₹1,800 million (+60% YoY), EBITDA: ₹3,389 million (+37% YoY), margin at 22.9%.

• Gross margin: 65.6%, up 74 bps YoY, driven by product mix shift to complex generics.

• Operating cash flow: ₹3,874 million, significantly higher than previous quarter.

• Net debt reduced to ₹1,012 million (0.07x net debt/EBITDA), nearly debt-free.

• Basic and diluted EPS (consolidated) for the quarter were ₹7.26 and ₹7.12, respectively.

Outlook and guidance

• Confident of sustaining current growth trajectory for FY27, with margins expected in the 22%-23% range.

• CapEx guidance for FY27 remains at ₹6,000 million, focused on digitalization and modular growth.

• Peptide CDMO aims to turn PAT positive for the year, with annual revenue run-rate at least matching Q1 levels.

• Oncology segment to see significant launches from FY28-29, with 9-13 products in development.

• Nine U.S. launches pending FDA clearance, with 18 total products awaiting approval.