Summary
Sakar Healthcare Limited - Q3 FY26 Earnings Call Summary Wednesday, February 11, 2026 11:00 AM
Event Participants
Executives 4 Bharat Soni, Bikramjit Ghosh, Dharmesh Thaker, Pushpa Ponmany
Analysts 6 Aditya Mutha, Ankit Gupta, Avinish Burman, Hitaindra Pradhan, Ishit Desai, Vedant Nilekar
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Revenue from Operations | ₹70.34 crores | +62% YoY; Driven by oncology vertical traction and high-margin exports. |
| EBITDA | ₹18.59 crores | +58% YoY; Reflects stronger product mix and operating leverage. |
| EBITDA Margin | 26% | -40 bps YoY; Remained stable despite aggressive R&D and employee scaling. |
| Profit After Tax (PAT) | ₹10.25 crores | +126% YoY; Aided by lower tax provisions and oncology scale-up. |
| PAT Margin | 14.5% | Improved significantly from 10.4% in Q3 FY25. |
| Oncology Revenue (Q3) | ₹31 crores | Comprises ₹19 crores exports (mostly EU) and ₹12 crores domestic. |
| Gross Margin | 49% | Maintained by high-compliance manufacturing and scale benefits at Bavla. |
| Capex (9M FY26) | ₹39 crores | Primarily for plant machinery and capacity upgrades; bulk of capex now complete. |
Geographic & Segment Commentary
- Oncology Vertical: This segment is the primary growth driver, with revenue doubling over the previous year. The Bavla facility is now approved as a manufacturing source for the EU, with 102 dossiers submitted globally and 11 marketing authorizations (MAs) received across Europe and emerging markets for products like Imatinib and Capecitabine.
- Exports: Own-brand exports now contribute over 70% of total revenue. Strategic focus remains on regulated markets (Europe) alongside APAC, Latin America, Africa, and CIS regions.
- Domestic Market: Contributed ₹12 crores to oncology sales in Q3; the company maintains partnerships with 18-20 local players, including major names like Zydus, Torrent, and Glenmark.
Company-Specific & Strategic Commentary
- Oncology Tech Transfer: The company is executing tech transfers for 10 molecules with big pharma partners (Accord/Intas); 2 products are already approved with the remaining 8 expected by Q2 FY27.
- Backward Integration: Sakar has developed 21 oncology APIs and submitted 4 CEPs (Certificate of Suitability) to improve margins and supply chain reliability through in-house API-FDF integration.
- Niche Formulations: Development of a unique basket of 10-12 oncology oral suspensions, a differentiated format currently seeing high partner interest due to limited competition.
- Operational Efficiency: Higher capacity utilization at the Changodar (Cephalosporin) and Bavla (Oncology) units is driving the 62% top-line growth.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Annual Revenue | >40% Growth (FY26) | Based on current order book and oncology traction; tracking toward ~₹280 crores. |
| Oncology Growth | 60%-70% YoY (FY27) | Expected ramp-up from EU commercialization and tech transfer completions. |
| EBITDA Margin | ~30% Target | Management expects margins to expand as high-margin oncology exports scale. |
| Tax Rate | 18%-19% (FY26/27) | Utilization of MAT credit; expected to revert to 25% post-FY27. |
Risks & Constraints
| Risk | Context |
|---|---|
| Regulatory Delays | Standard EU approval timelines are 210 days, but “stop clock” queries can delay commercial launches. |
| Working Capital/Logistics | International sales are conducted on advance payment terms; dispatches depend on partner-managed logistics which can face 90-150 day lead times for first orders. |
| Concentration Risk | Significant growth is tied to the Accord/Intas partnership in Europe; failure to scale these specific tech-transfer molecules could impact projections. |
Q&A Highlights
Accord/Intas Partnership
- Question: How significant is the Imatinib opportunity and the tech transfer pipeline? (Ankit Gupta)
- Answer: Accord dominates 60-70% of the European market for these molecules; Sakar expects the 10-molecule portfolio to have a potential of ₹50-₹100 crores (Bikramjit Ghosh).
Commercialization Timelines
- Question: When will European commercial supplies for the new MAs begin? (Saurabh Gupta)
- Answer: First dispatches for Bulgaria and Bosnia are expected in April or May 2026 (Q1 FY27), following 90-150 day lead times for serialization and artwork (Bikramjit Ghosh).
Financial Stability
- Question: Why was the tax rate lower this quarter and what is the capex outlook? (Saurabh Gupta / Vedant Nilekar)
- Answer: Tax is lower due to MAT credit utilization; major capacity capex is now complete, with only maintenance capex expected in FY27 (Dharmesh Thaker).
Competitive Edge
- Question: What is the strategy for the TKI (-tinib) portfolio in Europe? (Prateek Dugar)
- Answer: Sakar has 50+ oncology agreements and is partnering with market leaders like Heumann (Germany) and Torrent (UK) rather than entering directly (Bikramjit Ghosh).
Key Takeaway
Sakar Healthcare delivered a robust Q3 FY26, characterized by a 62% YoY revenue surge to ₹70.34 crores and a 126% jump in PAT. The performance was anchored by the oncology vertical, which contributed ₹31 crores in the quarter and is transitioning toward high-margin regulated market supplies following EU GMP approval. Strategically, the company is shifting from dossier-selling to commercial manufacturing, evidenced by the tech transfer of 10 molecules for Accord/Intas and the receipt of 11 MAs in Europe. Management guided for over 40% total revenue growth in FY26 and projected oncology to grow 60-70% in FY27 as EU commercialization begins in Q1 FY27. While MAT credits will support PAT in the near term, the long-term focus remains on achieving 30% EBITDA margins through backward API integration and niche oral suspension formulations. Future growth depends on the timely execution of regulatory filings and the successful ramp-up of the European partnership pipeline.
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