Granules India (532482) Q2 25/26 earnings summary

Executive summary

• Achieved 34% year-over-year revenue growth in Q2 FY 2026, led by formulation business in North America and Europe, with EBITDA growth despite a ₹200 million loss from SLS/Ascelis Peptides.

• Operational efficiency, improved product mix, and capacity expansion contributed to margin improvement.

• Regulatory remediation at Gagillapur is in final stages, with FDA meeting scheduled for January 2026 and facility cleared by German and Danish authorities.

• Genome Valley facility received FDA approval, adding 10 billion doses of capacity and enabling new product launches.

• SLS Peptides (including Senn Chemicals) integration progressing, with profitability targeted for Q4 FY 2026.

Financial highlights

• Q2 FY 2026 revenue: ₹12,970 million, up 34% year-over-year and 7% sequentially.

• Gross margin: 65.7%, up 368 bps year-over-year and 82 bps sequentially.

• EBITDA: ₹2,782 million (21.5% of sales), up 37% year-over-year.

• PAT increased 34% year-over-year to ₹1,306 million, with PAT margin stable at 10.1%.

• R&D expenses: ₹705 million (5.4% of sales), consistent with prior quarters.

Outlook and guidance

• Expecting normalization of operations and new product approvals at Gagillapur post-remediation.

• Anticipate double-digit top-line growth from FY 2027, supported by capacity expansion and new launches.

• SLS Peptides expected to turn EBITDA profitable in Q4 FY 2026, with full profitability targeted in FY 2027.

• R&D investments and regulatory progress support long-term strategic growth.

• Portfolio expansion and new product launches are expected to drive future growth.