Aurobindo Pharma’s financial results for the first quarter of FY26 fell short of market expectations, with a 10.2% year-on-year decrease in net profit to ₹824.2 crore, missing estimates. While revenue saw a 4% increase, both margin and EBITDA figures were below anticipated levels.
The company reported a consolidated net profit of ₹824.2 crore for Q1, down from ₹918.2 crore in the previous year, failing to meet the CNBC-TV18 poll estimate of ₹919.3 crore. Revenue for the quarter stood at ₹7,868 crore, reflecting a modest 4% rise from the same period last year but still below analysts’ projections of ₹8,215 crore.
Aurobindo Pharma’s EBITDA remained relatively stable, decreasing by 1% year-on-year to ₹1,603 crore, falling short of the estimated ₹1,730 crore. The EBITDA margin contracted to 20.3% from 21.4% a year ago, missing the anticipated 21.1% margin.
In terms of revenue breakdown, the company’s US formulations revenue experienced a slight 1.9% decline to ₹3,488 crore, impacted by destocking and seasonal factors. Conversely, the European formulations business displayed robust growth, increasing by 18% year-on-year to ₹2,338 crore.
While revenue from growth markets rose by 8.8% to ₹772 crore, antiretroviral revenues surged by 55.2% to ₹355 crore. However, revenue from the Active Pharmaceutical Ingredients (API) segment fell by 16% to ₹916 crore.
Aurobindo Pharma’s R&D expenditure for the quarter accounted for 4.7% of total revenues, with the company receiving final approval for 14 Abbreviated New Drug Applications (ANDAs) from the USFDA. Despite the challenges faced, the company’s Vice-Chairman and Managing Director expressed confidence in the strong growth momentum of the European business and the resilience of the core US business.
In light of the financial results, Aurobindo Pharma announced an interim dividend of ₹4.00 per equity share (400%) with August 8, 2025, set as the record date for dividend entitlement. The dividend is scheduled for payment on or before August 21, 2025. Following the earnings announcement, the company’s stock closed at ₹1,092.00 on the NSE, representing a 1.13% increase for the day.
Key Takeaways:
– Aurobindo Pharma’s Q1 net profit declined by 10.2% year-on-year, missing estimates.
– Revenue showed a 4% increase, but margin and EBITDA figures fell below expectations.
– The company’s European formulations business demonstrated strong growth, while the US formulations revenue experienced a slight decline.
– Aurobindo Pharma declared an interim dividend of ₹4.00 per equity share, with a record date set for August 8, 2025.
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