NATCO Pharma (NATCOPHARM) Q3 24/25 earnings summary

Executive summary

• Q3 FY25 consolidated revenue was INR 651.1 crore (INR 6,511 Mn), down from INR 795.6 crore (INR 7,956 Mn) year-over-year, with net profit at INR 132.4 crore (INR 1,324 Mn) versus INR 212.7 crore (INR 2,127 Mn) last year.

• Weak quarterly performance was due to absence of Revlimid sales, high R&D expenses, and lower export formulation contribution.

• Management expects a strong rebound in coming quarters, driven by new Revlimid allocation and product launches.

• Board declared a third interim dividend of INR 1.5 per equity share for FY25.

• Settlement reached in U.S. patent litigation for generic Ozempic; ANDA filed for generic EVRYSDI with shared First to File status.

Financial highlights

• Q3 FY25 revenue declined 18% year-over-year; net profit dropped by 38% compared to the same period last year.

• EBITDA for Q3 FY25 was INR 2,151 Mn, with a margin of 33%.

• PAT margin was 20.3% for Q3 FY25.

• Q3 FY25 EPS (consolidated): INR 7.43, down from INR 11.88 in Q3 FY24.

• Other income included a one-time pre-tax gain of INR 90 crore from sale of land.

Outlook and guidance

• Management anticipates improved performance in Q4 and subsequent quarters, driven by fresh Revlimid allocation and new product launches.

• Guidance for FY26 is cautious, with earnings expected to be maintained, but subject to price erosion in Revlimid.

• Significant earnings drop (50-60%) expected in FY27 as Revlimid exclusivity wanes.

• Pipeline includes 28 Para IVs in the U.S., with 13 approved (tentative or full).

• Focus on first-to-file opportunities for high-value generics, including Ozempic and EVRYSDI.