Aurobindo Pharma, one of India's largest generic drug makers with a growing Europe and US formulations business, reports its Q2 FY 2026-2027 results with the quarter's key question being whether margins can hold above the 21% mark amid sharply higher freight and input costs. The print will also speak to the first full quarters of the Lannett acquisition — management has guided to at least $60 Mn in quarterly net sales — and to the USFDA warning letter at Eugia Unit I, a facility contributing about 2% of group revenue.
| Results date | November 04, 2026 |
|---|---|
| Quarter | Q2 FY 2026-2027 |
| Previous quarter revenue | Rs. 9,150 Cr (+16.3% YoY, +3.4% QoQ) |
| Previous quarter PAT | Rs. 1,032 Cr (+25.2% YoY) |
| Previous quarter EBITDA margin | 21.0% |
| Market cap | Rs. 96,744.04 Cr |
| CMP | Rs. 1,681.4 |
Aurobindo Pharma's board will meet on November 4, 2026 to approve standalone and consolidated unaudited financial results for the quarter and half year ended September 30, 2026, and to consider an interim dividend for FY 2026-27. The trading window remained closed from October 1 to November 6, reopening on November 7.
The November 4, 2026 board meeting will specifically consider an interim dividend for FY 2026-27. The declaration amount will be known only with the board outcome; at the 39th AGM in August 2026, the company confirmed a Rs. 4 per share interim dividend for FY 2025-26.
The quarter's central test is the margin bridge to management's FY27 guidance of EBITDA margins north of 21% and absolute EBITDA in excess of Rs. 8,000 Cr, set against container freight running roughly 130% above February levels and raw material/solvent costs up 2.5x-2.7x. The rupee's 1.2% depreciation over the July-September quarter offers a management-quantified offset of about Rs. 100 Cr of EBITDA per 1% INR depreciation, though management itself notes the input and freight inflation is partly the flip side of that currency benefit.
On growth, the US segment (Rs. 3,770 Cr, +8.1% YoY in Q1) enters its first full quarters with Lannett, where management has guided to at least $60 Mn in quarterly net sales, while generics carry 0% US tariff until August 2028 under the July 2026 policy. Europe, which grew 25.6% YoY in Q1 and crossed the EUR 1 billion annual revenue milestone in FY26, has management expecting higher antibiotic sales from September-October onwards.
The Eugia Unit I warning letter, issued August 14, 2026 to a facility contributing about 2% of group revenue, remains a live overhang, with the company stating no impact on existing US supplies. The upcoming call is also expected to cover tax normalization from 31.9% in Q1 toward 28-29% by year-end and the interim dividend consideration at the November 4 board meeting.
Performance vs FY27 guidance tracking: Management reiterated FY27 guidance on the Q1 FY27 call in August 2026.
Eugia Unit I warning letter and USFDA inspection follow-ups: The August 14, 2026 warning letter to Eugia Unit I follows OAI status communicated May 24, 2026.
TheraNym CMO build-out: The biologics CMO ramp is a multi-year capex program anchored by Merck/MSD contracts.
Pen-G backward integration and China EBITDA: Pen-G and 6-APA turned EBITDA-positive in Q4 FY26 after a FY26 loss of over Rs. 200 Cr.
Margin bridge and one-off items: Q1 FY27 carried a one-time Rs. 43 Cr lease derecognition item whose adjustment direction differs between the concall narrative and the presentation footnote.
Management has guided FY27 EBITDA margins north of 21%, with the guide baking in a ~Rs. 100 Cr EBITDA benefit per 1% INR depreciation against raw material/solvent costs up 2.5x-2.7x and higher freight. Container rates ran roughly 130% above February levels through July-October 2026, making the net margin bridge the key question on the call.
Management expects at least $60 Mn in quarterly net sales from the Lannett portfolio before other products contribute. The acquisition was completed on June 29, 2026 for Rs. 2,334.88 Cr (USD 247.1 Mn), with growth drivers including controlled substances quotas and respiratory launches.
The warning letter was issued on August 14, 2026 to Eugia Unit I, a formulation facility contributing about 2% of group revenue. The company states there is no impact on existing US supplies.
On the Q1 FY27 call, management reiterated double-digit FY27 revenue growth, EBITDA margins north of 21% and absolute EBITDA in excess of Rs. 8,000 Cr, with Q1 revenue at Rs. 9,150 Cr (+16.3% YoY) and EBITDA margin at 21.0%. Nothing retrieved in the quarter breaks that path, per the pre-call note.
TheraNym Unit 1 (60 kL), inaugurated June 3, 2026, begins qualification activities in November 2026 with first commercial revenues expected in 2028. Unit 2, with estimated capex of USD 180 Mn, is scheduled to be ready for qualification in 2030 with revenues from 2031.
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