Ipca Laboratories (IPCALAB) Q2 25/26 earnings summary

Executive summary

• Domestic formulation business grew 8% in Q2 FY26, recovering after GST rate changes in September 2025, with strong October performance.

• Market share improved from 2.3% to 2.8% year-over-year, with Q2 growth of 11.6% outpacing the 7.8% market growth.

• Chronic business share increased to 35%, and both acute and chronic segments outperformed the market.

• Standalone net total income rose 7% year-over-year to ₹1,952.24 crore in Q2 FY26; consolidated net total income increased 9% to ₹2,584.36 crore.

• Standalone net profit after exceptional items grew 25% to ₹304.74 crore; consolidated net profit after exceptional items rose 23% to ₹282.57 crore in Q2 FY26.

Financial highlights

• Export formulation revenue declined 9% year-over-year to INR 493 crore in Q2, but H1 was flat at INR 941 crore.

• API business grew 28% in Q2 to INR 408 crore, with full-year growth expected at 14%-15%.

• Standalone EBITDA margin improved to 25.46% (from 22.89%), and consolidated EBITDA margin rose to 21.68% (from 19.1%) year-over-year.

• Standalone earnings per share (EPS) after exceptional items was ₹12.01, up 25% year-over-year; consolidated EPS after exceptional items was ₹11.14, up 23%.

• R&D spend increased to 3.91% of turnover in Q2, expected to remain at 4%-4.75% of turnover next year due to biosimilar and filing activities.

Outlook and guidance

• Domestic growth guidance maintained at 10%-11% for FY26.

• Export generics expected to grow 8%-9% in H2 FY26, with branded exports targeting 9%-10% growth for the full year.

• API business guidance at 14%-15% growth for the year.

• Margin guidance raised by 100 bps due to improved product mix and Unichem recovery.

• Management highlighted continued growth in both domestic and export markets, with a focus on expanding API exports and maintaining strong EBITDA margins.