Strong Q1 growth, margin compressed by geopolitical costs

₹4018.5 Cr vs ₹3264.4 Cr last year Q1

Approved with CGT designation, 180-day exclusivity

Explicitly stated as remarkable ramp in oncology

Q1 OPM 20.0%, at lower end; NPM 11.8% post-deferred income

Q1 OPM 20% vs prior ≥21% suggests headwinds not fully offset yet

Affirmed; cash position ₹800-900 Cr operating cash

Management set 5-year target: 30% (now) → 60% (2031) via respiratory/derm launches. More specific than prior vague guidance.

Guided 12-15% consistent basis going forward (prior was implied). Volume ~6%, new products ~3%, value ~3-4%.

Reaffirmed 21-22% full-year OPM, but Q1 delivered 20%. Cost headwinds (geopolitical) real; offset strategy relies on mix improvement—not yet evidenced.

Flovent 44 approved; 2-3 more respiratory launches (110 mcg, nasal spray Rx, ipratropium) expected H2 FY27. Aligns with prior 'strong finish' guidance.

No AbbVie milestone payments yet (only ₹700M upfront). Management waiting for clinical data before ISB 2301 partnership—more cautious than hoped.

R&D Q1 was ₹289 Cr (7.2% of revenue). Going forward, 7-8% overall. IGI spend will be ₹70 Cr ongoing, including 2301 Phase I and future clinical trials over 2-3 years.

Europe guided high single digit this year due to strategic shift to branded products (currently 30%, target 60% in 5 years). We were fastest-growing for 4 years; now repositioning. Double-digit growth expected from FY28 as branded launches scale.

Still takes time. Most are commodity injectables. Respiratory launches (fluticasone 44, nasal spray OTC) are primary U.S. drivers this year. Monroe differentiated injectables will contribute next year in addition to respiratory work.

Geopolitical situation impacting API and logistics costs. Mitigating through product and geographical mix. Margin impacted but not to extent of full impact. At least 2 more quarters of pressure expected. Full-year margin guidance 21-22% will hold given new launches and India strength.

India is a fantastic business with strong franchise across therapies. Cardio growing 15%, derm strong, respiratory (chronic) 25%+. TEVIMBRA/BRUKINSA at ₹100Cr in 12 months. Model 12-15% growth consistently going forward.

Strong brands are positive. Portfolio is extremely diversified: Telma, Ascoril, Alex, Candid, TEVIMBRA, BRUKINSA, OTC franchise. No risk to India business performance.

Already investing in oncology commercial capabilities in emerging markets. Margin guided 21-22% because these investments prepare for Aumolertinib, Trastu Reze, envafolimab launches. These 3 can generate ₹500-600M over 5-6 years.

2301 is a super exciting penta-specific asset. Globally novel (targets NK cells + T cells + tumor antigens). Will wait until clinical data and POC in humans before seeking partnerships.

In H2, expecting 2-3 of these respiratory products approved: 110 mcg, nasal spray Rx, ipratropium. Hope at least 2 come through.

Half-quarter benefit in Q1. Full quarter financial benefit expected in Q2.

Moved backup compound STAR-0310 to Phase I. BioCryst just acquired Astria; still figuring out their next steps. No visibility yet.

Guided 115 days net working capital days for full year. Currently well below. Gross debt zero maintained. Operating cash ₹800-900 Cr.

Volume ~6%, new products ~3%, value ~3-4%. Most is volume-driven due to high competitive intensity. Still have runway: Aumolertinib, Trastu Reze launches upcoming, plus respiratory launches.

Priorities: prepare for U.S. respiratory launches in H2, prepare for Aumolertinib launch in India/EM (H2), field force expansion. Risk this year relatively low—it's execution-focused. All work for future growth already done.

Growth is culmination of past work; all current work drives future growth. Risk relatively low. Moving to branded/innovative portfolio de-risks regulatory risk.

Multiple initiatives: improve working capital efficiency, reduce debtor days, improve vendor terms, optimize supply chain financing, trade-MSME financing, global factoring.

Aumolertinib (NSCLC, licensed from Hansoh), Trastu Reze (HER2 ADC, from Hengrui). Both big products. Over next 5-10 years, significant innovation launches. ISB 2001 will be the big one when it launches.

WINLEVI is niche (acne), differentiated. Adoption just started. Will take time to build. Also have couple other branded derm products promoting to drive overall derm franchise in Europe.

Most litigations already provided for. Settled state AGs and DPPs. EPPs and one more group still to go. Outside of that, mostly done with major litigations.

Gross debt zero maintained. Operating cash ₹800-900 Cr. Model based on balance sheet perspective, not absolute cash number.

About 5,600 MRs, add 300-400 annually. Oncology doesn't need expansion—already in oncology, already have sales force.

Only ₹700M upfront received so far. No milestone payments yet. Deferred income from ISB 2001 part of ₹700M.

Driven by TEVIMBRA/BRUKINSA, chronic respiratory, cardiovascular (Telma), dermatology, new launches. Volume-led (6%), 3% new products, 3-4% value.

Flovent 44 (half-quarter Q1, full-quarter Q2), 2-3 more respiratory approvals expected H2 FY27. Monroe injectables to contribute FY28+.

Strategic shift to branded (30% now → 60% target in 5y). RYALTRIS, WINLEVI, derm portfolio driving transition.

Geopolitical cost pressures (API, logistics, freight) offsetting through product/geographical mix. Reaffirmed 21-22% but Q1 miss suggests execution risk.

Delayed from FY27; dependent on cost normalization and innovation contribution scaling.

Mixed product/geographical performance; at least 2 more quarters of cost pressure expected per management.

Q1 ₹289 Cr (~7.2% of revenue). IGI spend ₹70 Cr ongoing including ISB 2301 Phase I and clinical trials over 2-3 years.

Ongoing geopolitical situation (Ukraine war) impacting raw material, API, and shipping costs. Management expects pressure for at least 2 more quarters. At least 1-2% margin compression observed vs prior years.

Europe grew only 11.9% in Q1, below expectations. Management frames as strategic shift to branded (away from generics) but transition timing and success uncertain. Target to return to double-digit FY28 is dependent on branded launch ramp.

Management expects 2-3 respiratory ANDA approvals in H2 FY27 (110 mcg, nasal spray Rx, ipratropium), but hopes at least 2 of 3 come through. Delays would impact North America growth trajectory and full-year margin.

Aumolertinib (EGFR TKI for NSCLC) expected to launch H2 FY27 in India and emerging markets. Management targets ₹500-600M over 5-6 years alongside Trastu Reze and envafolimab, but competitive landscape in oncology is intense. Market adoption, pricing power, and competitor responses uncertain.

Received only ₹700M upfront from AbbVie; ₹1.2B in milestone payments not yet activated. If clinical development slows or deal is renegotiated, milestone cash flow may be delayed or reduced. P&L deferred income benefit is one-time.

Most litigation provisions already taken (state AGs, DPPs settled). Two smaller groups (EPPs and one more) still pending. Management expects minimal P&L impact, but cash outflows may occur over 2 years.