Cohance Lifesciences announced its financial results for the quarter and nine months ended December 31, 2025. Despite near-term challenges, 9MFY26 saw gross margins improve significantly to 72.8%. The company is navigating a crucial transition phase, focusing on execution, leadership stabilization, and recovery anchored for growth returning in FY27. Key platforms like ADC and Oligonucleotides remain strategically sound for the long term.
Financial Performance Summary (Q3 & 9M FY26)
Cohance Lifesciences reported its financial results for the quarter ended December 31, 2025. The overall performance reflects a transition and bottoming phase driven by portfolio mix changes and customer-led inventory normalization.
9MFY26 Highlights:
- Revenue declined by 6.7% YoY to ₹16.5 billion.
- Gross margins significantly improved to 72.8%, up 204 basis points YoY, supported by product mix and subsidiary consolidation.
- Adjusted EBITDA declined by 43% to ₹3.5 billion, resulting in Adjusted EBITDA margins of 21.1%. Standalone Adjusted EBITDA margins were 24.2%.
- The Niche Technology segment maintained a significant share, accounting for 15.1% of revenue.
- Specialty Chemicals revenue showed strong growth of 31.6% YoY.
- Free cash flow generation remained sturdy at ₹1.75 billion during the quarter, with total cash reserves at ₹4.32 billion.
Q3FY26 Snapshot:
- Revenue declined by 19.5% QoQ to ₹5,446 million.
- Adjusted EBITDA margins stood at 15.6% for the quarter.
Business Performance Overview
Pharma CDMO: Navigating Near-Term Challenges
The Pharma CDMO segment (39% of Sales) faced delays due to customer inventory adjustments and timing shifts. However, RFQ intensity is up 2x YTD, with 16+ innovator and biotech audits completed in the last four months. The commercial pipeline includes 9 Phase III assets, with 4 expected to enter commercial supply soon.
ADC and Oligos: Long-Term Outlook Intact
The long-term outlook for ADC and Oligonucleotides remains strong. The ADC platform is progressing, including a USD 10 million US-based cGMP expansion underway to enable supply up to Phase 2b by FY27. The Oligonucleotides market is projected to grow at a 25%+ CAGR, reaching $4 billion by FY29E.
Specialty Chemical (Spec/Ag Chem)
This segment (12% of Sales) was impacted by regulatory timing and qualification cycles in FY26. The focus remains on strengthening R&D to move into higher value-added chemistries, including potential extension into semiconductor chip processing.
API+ Continues to Track Growth
The API+ segment (49% of Sales) saw near-term moderation due to timing adjustments and pricing resets. Filing progress is steady, with 8 DMF/CEP filings completed and 5 formulation filings completed. The Nacharam FDF facility operations have resumed in a phased manner for non-US markets post-regulatory remediation.
Transition and Strategic Positioning
Management characterized FY26 as a transition year, focusing on stabilizing leadership, strengthening execution discipline, and advancing commercial conversions. The Executive Chairman noted that the company is well positioned to return to growth as customer programs advance and commercial conversions accelerate, expecting a return to revenue growth in FY27.
Quality and Governance Focus
Senior quality leadership has been embedded across sites. Remediation actions following a temporary disruption at Nacharam are underway, which led to approximately ₹55 crore in shipment deferrals during the period. On-time, in-full (OTIF) performance for commercial supplies remains consistently above 95%.
Source: BSE
