ICRA has reaffirmed Biocon’s credit rating at [ICRA]AA+(Stable)/[ICRA]A1+. The reaffirmation considers Biocon’s diversified business model, vertically integrated operations, and global footprint. ICRA expects Biocon’s credit profile to improve over the near-to-medium term. BBL plans to launch five biosimilars soon. The ratings also factor in a one-time gain of Rs. 1,057 crore from the sale of its branded formulations segment.
Rating Drivers
The reaffirmation of Biocon’s credit rating is based on several key factors:
- Diversified Business: Biocon’s business model spans biosimilars, generics, and research services.
- Global Presence: The company has a significant global footprint with vertically integrated operations.
Biosimilars Business
Biocon Biologics Limited (BBL) has received approval for 11 biosimilars across regulated and emerging markets. BBL was the largest contributor to consolidated revenues in FY2025. The company plans to launch five biosimilars soon. This is expected to boost revenue growth and improve operating margins.
Financial Performance
Biocon reported a 10.6% year-over-year increase in revenues in FY2025. This was adjusted for the sale of branded formulations (BF) segment to Eris Lifesciences, resulting in a gain of Rs. 1,057 crore. The operating profit margin (OPM) improved to 26.8% in FY2025 from 22.6% in FY2024, driven by the one-time gain from the sale of the BF segment.
Debt and Equity
In FY2025, BBL refinanced its borrowings through senior secured notes worth $800 million (Rs. 6,695 crore) and a new syndicated term loan of $320 million (Rs. 2,697 crore). Biocon successfully fulfilled its obligations to Viatris in FY2025. Following a Rs. 4,500-crore equity raise through a Qualified Institutional Placement (QIP) in June 2025, Biocon has also retired the structured debt, improving leverage metrics.
Rating Outlook
The stable outlook reflects ICRA’s expectation that Biocon will sustain its operating metrics and continue its deleveraging efforts. The outlook also underlines that the company will fund its capacity expansion in a manner that allows it to maintain its debt protection metrics.
Source: BSE
