Aurobindo Pharma Limited Q3 FY26 Earnings Call Summary

Summary

Aurobindo Pharma Limited - Q3 FY26 Earnings Call Summary Tuesday, February 10, 2026

Event Participants

Executives 5 Dr. Satakarni Makkapati, Mr. S. Subramanian, Mr. Swami Iyer, Mr. V. Muralidharan, Mr. Yugandhar Puvvala

Analysts 8 Bino Pathiparampil, Damayanti Kerai, Harshit Dhoot, Jigar Valia, Kunal Dhamesha, Neha Manpuria, Nitin Agarwal, Tushar Manudhane

Financials & KPIs

Geographic & Segment Commentary

• US Formulations: Revenue excluding gRevlimid grew 9% YoY, with 9 new product launches and 7 approvals during the quarter. The Dayton facility has transitioned to commercial manufacturing, expected to contribute significantly from FY27, while the Raleigh facility awaits regulatory clearance.
• European Formulations: On track to exceed $1 billion in annual revenue by the end of FY26, supported by 261 million Euros in Q3 revenue. Sustained double-digit constant currency growth in France, Germany, and Netherlands is being bolstered by increasing supply from China operations.
• Biosimilars & Biologics: First Canadian approval for Dyrupeg received, and Bevacizumab biosimilar launched in the UK. Management targets 2029 as the “inflection year” for biotech, with Omalizumab and Denosumab filings expected in mid-2026.

Company-Specific & Strategic Commentary

• Pen-G & PLI Initiative: Annualized production reached 9,000-10,000 MT in January 2026 at the Lyfius facility. The Government’s Minimum Import Price (MIP) on Pen-G ($25/kg) and 6-APA ($37/kg) is expected to turn the loss-making 6-APA segment profitable by Q1 FY27.
• Eugia Sterile Inspection: Recent USFDA inspection of Eugia III resulted in procedural/technical observations only, with no data integrity issues. Production continues uninterrupted, and a response is being filed within 15 working days.
• M&A Strategy: The Lannett acquisition is progressing through FTC review with closure expected in Q1 FY27. The company is also integrating domestic pharma acquisitions totaling $251 million.
• Vizag Injectable Expansion: Plant currently has 3 products filed with 10 more in the pipeline. It features specific lines for GLP-1 (cartridges), PFS, and BFS, with significant revenue contribution expected in FY27-28.

Guidance & Outlook

Risks & Constraints

Q&A Highlights

Operating Status of Eugia III

• Question: What is the nature of the observations at Eugia III and will production stop? (Tushar Manudhane)
• Answer: Observations are procedural and technical with no data integrity issues; production is continuing normally (Yugandhar Puvvala).

Pen-G and 6-APA Economics

• Question: How will the Minimum Import Price (MIP) impact margins? (Neha Manpuria/Bino Pathiparampil)
• Answer: The Pen-G facility has already achieved breakeven. While the 6-APA segment currently incurs losses due to market pricing, the MIP will serve as a catalyst for profitability starting April 2026 (S. Subramanian).

Biosimilar Commercialization

• Question: What is the timeline for biosimilar revenue contribution? (Shyam Srinivasan)
• Answer: Recent launches include Bevacizumab in the UK and Trastuzumab in the Baltics. FY2029 is identified as the major inflection year when the full pipeline reaches scale (Dr. Satakarni Makkapati).

Lannett Acquisition Progress

• Question: What is the status of the FTC approval for the Lannett deal? (Neha Manpuria)
• Answer: Management is actively engaging with the FTC; there are no “negative surprises,” and closure is expected in Q1 FY27 (Swami Iyer).

Key Takeaway Aurobindo Pharma Limited delivered a resilient Q3 FY26, with revenue growing 8.4% YoY to ₹8,646 crores and EBITDA margins maintaining a strong 20.5% profile. The quarter was characterized by a 27% surge in European revenue and steady US performance despite the tapering of gRevlimid contributions. Strategically, the company has stabilized its Pen-G production at an annualized 10,000 MT, positioning itself to benefit significantly from the Government’s new Minimum Import Price (MIP) protections starting in FY27. While regulatory scrutiny remains a factor at the Eugia sterile facility, management confirmed that recent observations are procedural and do not impact production. Looking ahead, the company is focusing on high-value complex generics, biosimilars (targeting a 2029 inflection), and the integration of the Lannett acquisition to sustain its 20-21% EBITDA margin target. Management remains confident in achieving over $1 billion in annual European revenue by fiscal year-end.