Neuland Laboratories has published the official transcript for its Q3FY26 Earnings Conference Call, which took place on February 9, 2026. The call covered financial performance for the quarter and nine months ended December 31, 2025. Key discussions focused on margins impacted by product mix, the progress of the peptide CDMO ramp-up, and the strategic long-term outlook involving significant R&D center investment.
Q3FY26 Financial and Business Highlights
Neuland Laboratories Limited provided an update following its Q3FY26 earnings call. CFO Mr. Abhijit Majumdar reported that Total Income for Q3FY26 stood at INR447.8 crores, marking an 11.4% YoY growth over the INR401.9 crores reported in the previous year’s corresponding period. Commercial CMS projects contributed over 50% of the quarter’s revenue.
The Gross Margin for the quarter was 52.1%, down from 53.2% in Q3FY25, attributed to the product mix. EBITDA was INR85 crores, resulting in a 19% margin. Management noted that without an impact of INR10 crores towards labor codes, the EBITDA would have been INR95 crores, achieving a 21% margin. Profit Before Tax was INR54.3 crores, leading to a quarterly EPS of INR31.5 per share.
Strategic Business Evolution and Pipeline
Vice-Chairman and Managing Director, Mr. Saharsh Davuluri, emphasized the transition toward a business model predominantly driven by the human health focused CDMO sector. The company is adopting a longer-term view, assessing performance over 2- or 3-year periods rather than quarter-on-quarter due to the nature of CDMO gestation periods.
Key progress points highlighted include:
- Traction on the peptide side of the business, with investments for a new large-scale manufacturing capacity expected to be ready for commissioning in July.
- A strategic step approved by the Board to shift the R&D facility to a new, state-of-the-art campus in Genome Valley to support peptide development.
- The current pipeline remains healthy, though specific metrics like commercial molecules (at 9) and commercial APIs (at 9) showed little change, reflecting an increase in the value per molecule.
Margin and Inventory Discussion
When addressing margin concerns, management clarified that the lower gross margin was due to the absence of shipments from one higher-margin CMS product and operational issues affecting high-margin GDS products like Paliperidone. The expectation is that the Paliperidone issue should resolve by the next financial year.
On working capital, inventory days stood at 145 days of sales for the quarter, slightly higher than the desired 4 months (approximately 124 days). Management stated that this increase is a precursor to expected revenue ramp-up, and they anticipate inventory days normalizing back towards 90 days over the next three quarters.
Long-Term Outlook
Management expressed continued optimism, suggesting that growth for the next 2 to 3 years is largely “preordained” by existing commercial products. Investments in peptides and other expansions are aimed at setting a growth trajectory beyond this 3-year window, with the organization aspiring for a business that could achieve 20-plus CAGR between 2026 and 2036.
Source: BSE
