Biocon released the transcript for its Q3 FY26 Earnings Call, confirming the strategic transformation is nearing completion with the planned merger of Biocon Biologics into Biocon Limited, creating an integrated biopharma enterprise valued at USD 5.5 billion. The quarter saw 9% year-on-year revenue growth to INR 4,173 crores, driven by Biosimilars and Generics, while Core EBITDA grew 21% to INR 1,221 crores.
Q3 FY26 Performance Overview
Biocon reported a solid third quarter for FY26, with operating revenue reaching INR 4,173 crores, marking a 9% growth year-on-year. This performance was led by the Biosimilars and Generics segments, which offset a marginal 3% decline in the CRDMO business.
Key financial metrics for the quarter included:
- Core EBITDA: Increased 21% YoY to INR 1,221 crores, achieving a margin of 29%.
- EBITDA: Grew 21% YoY to INR 951 crores (margin 22%).
- Profit Before Tax (PBT): Rose 64% YoY to INR 226 crores (excluding exceptionals).
- Reported Net Profit: Stood at INR 144 crores for the quarter.
For the 9 months of FY ’26, operating revenues grew 14% and EBITDA grew 24% on a like-for-like basis.
Strategic Integration and Balance Sheet Strength
Chairperson Dr. Kiran Mazumdar-Shaw emphasized that the strategic transformation involving the acquisition of Viatris biosimilars business and the upcoming merger of Biocon Biologics with Biocon is concluding. This will establish an integrated biopharma platform. The company proactively strengthened its balance sheet over the past year, retiring structured debt associated with the Viatris transaction through two QIPs, raising nearly $1 billion.
Credit rating agencies affirmed this progress: S&P upgraded Biocon Biologics’ rating to BB+ with a stable outlook, and Fitch revised its outlook to positive.
Segmental Highlights: Biosimilars
The Biosimilars division posted revenues of INR 2,497 crores (9% YoY growth), primarily driven by the North America market. EBITDA surged 44% YoY to INR 700 crores, translating to a 28% margin.
Key updates included:
- Disclosure of 3 new biosimilar oncology assets: Trastuzumab subQ, Nivolumab, and Pembrolizumab, targeting a nearly US$ 75 billion market opportunity.
- Launch of generic Liraglutide in the Netherlands (first ‘direct-to-market’ GLP-1 in the EU).
- Securing global rights for Hulio® (adalimumab) from Fujifilm Kyowa Kirin Biologics.
- In the U.S., Yesintek® (ustekinumab) gained meaningful traction, and a strategic deal with Civica Inc. was established to launch affordable insulin glargine in California.
Segmental Highlights: Generics
The Generics business showed significant momentum, with revenue growth of 24% YoY to INR 851 crores, supported by launches of generic Liraglutide across the EU.
Operational milestones included receiving final U.S. FDA approval for tofacitinib extended-release tablets and achieving EIR with VAI status for the Cranbury OSD facility.
Segmental Highlights: CRDMO (Syngene)
Nine-month revenue for the CRDMO business was INR 2,702 crores (3% YoY growth). While Q3 revenue was down 3% YoY to INR 917 crores due to challenges with one customer, Syngene extended its partnership with Bristol-Myers Squibb through 2035.
Capital Expenditure Outlook
Management indicated that capex is largely behind the company. Group capex has moderated from roughly $275 million plus annually to less than $225 million. Future spending will primarily be maintenance capex, with substantial drug product capacity coming online in the coming fiscal year, expected to double capacity.
Q&A Key Takeaways
During the Q&A, management confirmed that the production upgrade timing was planned to align with increased demand. Regarding the insulin market, demand remains robust, and the business continues to focus on capacity expansion, anticipating significant growth in the franchise in FY ’27. Regarding debt, structured debt has been retired, and the management is focused on reducing the remaining debt through organic cash flow generation, noting the debt-to-EBITDA ratio has fallen below 2.5x.
Source: BSE
