Viyash Scientific Ltd Q1 FY27 Earnings Call: US EBITDA Margin Resets to 34%, PAT More Than Doubles

Viyash Scientific Ltd held its Q1 FY27 earnings call on August 11, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Revenue, Profit & Margin Highlights

• Revenue from operations Rs.946 Cr — +20% YoY (Q1 FY 2026-2027 vs Q1 FY 2025-2026), with 2.9% sequential growth.
• EBITDA Rs.205 Cr — +59% YoY; EBITDA margin expanded to 21.6%, up 530 bps YoY from 16.2% in Q1 FY 2025-2026.
• PAT Rs.79 Cr — more than doubled YoY (+115% vs Rs.37 Cr in Q1 FY 2025-2026), despite a Rs.19 Cr incremental ESOP expense booked in the quarter.
• Gross margin improved to 54.1% — up 220 bps YoY from 51.9% in Q1 FY 2025-2026, driven by product mix and backward integration.
• Net debt reduced to Rs.86 Cr — net debt/EBITDA at 0.1x (vs 0.24x in Q4 FY 2025-2026 and ~1x in Q1 FY 2025-2026); finance cost declined to Rs.12.5 Cr from Rs.20.4 Cr YoY.

Geography-Wide Growth & Product Mix

• US human formulation revenue +45% YoY in USD (& +60% YoY in INR) in Q1 FY 2026-2027, driven by backward-integrated complex products and restructuring that moved volume products to India.
• US EBITDA margin structurally reset — improved from ~1% in FY 2025-2026 to 34-35% in Q1 FY 2026-2027 (actual); management expects this level to continue in FY 2027-2028.
• EU revenue flat YoY in EUR (€16.8M vs €16.9M in Q1 FY 2025-2026); management guided 18-20% full-year growth in INR for FY 2026-2027, citing normal seasonal phasing.
• Emerging markets constant-currency growth ~23% in USD (36% revenue growth in INR) in Q1 FY 2026-2027, led by volume in Turkey, Brazil and Mexico; management noted 25%+ volume growth is not sustainable every quarter.
• Animal health domestic market +60% in Q1 FY 2026-2027; animal health formulation business grew strongly across all regions, per management.

API Trajectory, First-to-File & High Potent Buildout

• API revenue Rs.83 Cr in Q1 FY 2026-2027 — flat QoQ due to raw material price volatility from the ongoing war; management expects Q2 FY 2026-2027 to be a record quarter for API.
• Human API growth guided at 13-14% for FY 2026-2027 and FY 2027-2028 — acceleration expected from FY 2028-2029 driven by complex product launches; animal health API >20% growth in FY 2026-2027 (25% guided), supported by Vizag site US approval.
• ~50% of human API pipeline is first-to-file — combined brand value exceeds $20 Bn, but API opportunity is discounted due to 95% price erosion in generics and 50-60% in oncology/high-potent; API contributes ~20% of formulation value.
• High potent (oncology) API capabilities built over 18-24 months with three manufacturing modules; management expects revenue from FY 2028-2029 and formulation revenue post-FY 2029-2030; 5-6 API products filed, 50% first-to-file or first-to-launch.
• API acquisition (Bio for Life) as European launch pad — meaningful incremental revenue expected only after 24 months (post FY 2028-2029); management guided 25-30% API growth after FY 2028-2029.

Margin Bridge, ESOP, Capex & Debt

• EBITDA margin guidance maintained at 20-22% for FY 2026-2027 — Q1 came in at 21.6%, within the band; management reaffirmed focus on capital allocation for sustainable profitable growth.
• ESOP cost of Rs.150 Cr for full-year FY 2026-2027 — Q1 absorbed Rs.25 Cr, with ~Rs.40 Cr each remaining quarter; from FY 2027-2028, cost drops sharply to Rs.25-30 Cr with only routine charges after H1 FY 2027-2028.
• Annual capex guided at Rs.250-300 Cr for FY 2026-2027 — management considers this manageable given company size; 90% of current business is mature, requiring minimal incremental capital.
• Finance cost declining; goodwill amortisation stepping down — interest costs fell YoY to Rs.12.5 Cr, with further savings expected in FY 2027-2028; goodwill amortisation was Rs.25 Cr in Q1, reducing to ~Rs.10 Cr in Q2, yielding a ~Rs.15 Cr benefit from Q3 FY 2026-2027 onward.
• Minority interest at 16-17% of pre-minority profit in FY 2026-2027 — down from ~20% in FY 2025-2026; management guided a buyout of minority interests (US and Spain) within two years (by FY 2028-2029).

Acquisitions, Pipeline Horizons & Aspirational Targets

• Biocore Life (Italy) SPA signed — companion animal acquisition with ~85 products and ~85% vet clinic coverage in Italy; deal expected to close in the next few months (period unspecified).
• Bio-Solite acquisition pending, expected to close in FY 2027-2028 — the 18-20% US growth guidance for FY 2026-2027 excludes any benefit from this deal.
• Long-term revenue aspiration of $1 Bn by FY 2031-2032 — management expressed confidence in achieving this through organic execution and opportunistic M&A, citing balance sheet flexibility; "long-term aspiration of $1 billion revenue by FY 2032."
• Combined company-and-animal revenue target of $150-200 Mn by FY 2031-2032 — management expects the API business to grow 25-30% after FY 2028-2029 and reach this range.
• Human API portfolio extends up to 2040; animal health API pipeline runs up to 2035 — management stated "human API portfolio development extends up to 2040" with major products after 2030; main animal health patent expirations span 2027-2033, with growth accelerating from 2029.