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Revenue growth in line; higher interest and depreciation impact earnings

* Sales grew 23.4% YoY to INR35.7b for the quarter (vs est. INR35.6b).

* Domestic business (87% of sales) grew 19% YoY to INR31b for the quarter.

* Prescription business (Rx) (92% of domestic sales) grew 17.5% YoY to INR28.5b, supported by improved base business growth and the addition of the BSV portfolio.

* Consumer business (8% of domestic sales) grew 15% YoY to INR2.5b.

* Export (13% of sales) grew 81.1% YoY to INR4.7b, primarily due to the consolidation of BSV, supported by growth in the base business.

* Gross margin contracted 140bp to 70.5% due to an increase in raw material costs for the company.

* EBITDA margin contracted 130bp YoY to 24% due to higher raw material costs, while employee benefit costs and other expenses remained stable YoY as a % of sales.

* Accordingly, EBITDA grew 17% YoY to INR8.5b (vs our estimates of INR8.9b).

* PAT declined 24% YoY to INR4.3b (our est.: INR4.6b).

* Revenue/EBITDA/PAT missed the BBG estimate by 1%/6%/5%, respectively, for 1QFY26.

Other highlights

* PAT margins in Q1FY26 were weighed down by elevated interest and depreciation expenses.

* Mankind outperformed IPM growth by 60bp in secondary sales for 1QFY26, driven by healthy volume growth of 2.5% compared to 1.4% IPM volume growth.

* Mankind continued its outperformance of 1.4x in chronic growth vs IPM chronic – 1.5x in Cardiac and 1.6x in Anti-Diabetics therapies.

* The company (excl. BSV) launched one product in Q1FY26, bringing the total launched products to 45 in the US.

* The Consumer Health segment has maintained stable growth since FY25, in contrast to previous years, where it faced challenges in sustaining momentum.

* Capex for 1QFY26 stood at ~INR1.27b.

* Net debt position as of Jun’25 was INR52.5b.

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