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Generics led miss on earnings

• BIOS 1QFY26 revenues grew 15% YoY to INR39.4b (est. INR42.4b).
• ? Revenue growth was led by:
• Generics sales, up 5.7% YoY to INR7b (17% of sales).
• Research services (22% of sales), up 11% YoY to INR8.8b.
• Biosimilars (61% of sales), which rose 28.6% YoY to INR24.5b.
• Gross margin (GM), contracted 120bp YoY to 63.5%.
• EBITDA margin expanded 90bp YoY to 19% (est: 21.5%) due to lower R&D/ employee cost (-140bp/-60bp YoY as a % of sales).
• The EBITDA margin for Biocon Biologics stood at 20.8% for 1QFY26 (down 200bps YoY/down 110bps QoQ).
• The EBITDA margin of Syngene is 25.6% for the quarter (up 410bp YoY/down 810bp QoQ basis).
• The Generic business registered EBITDA margin of 1.9% vs 8.9% YoY and (23.2% QoQ).
• EBITDA grew 20.5% YoY to INR7.5b (est: INR9b) for the quarter.
• Adj. PAT came in at INR300m vs loss of INR1.6b YoY. ? Revenue/EBITDA/PAT miss BBG estimates by 2%/11%/71%

Key highlights

• During the quarter, the generics business margin was considerably impacted due to higher opex related to newer facilities.
• BIOS launched g-Micafungin and Everolimus in US in 1QFY26. BIOS received approval for Liraglutide for India market.
• BIOS received approval for Insulin Aspart during the quarter.
• BIOS launched aflibercept in Canada market during the quarter.
• Biocon launched Yesintek (b-Ustekinumab) in key European markets. It received positive opinion for Yesafili (bAflibercept)..

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