Windlas Biotech: Sustained Growth and Strategic Expansion in Q2 & H1 FY26

Windlas Biotech Limited has once again demonstrated robust financial performance, marking its 11th consecutive quarter of record revenue. For the second quarter and first half of fiscal year 2026 (Q2 & H1 FY26), the company reported impressive growth, underscoring its strategic initiatives and disciplined execution in a dynamic pharmaceutical market. Despite a subdued Indian Pharmaceutical Market (IPM) volume growth, Windlas Biotech's diversified business model and focus on quality have enabled it to outperform.

For H1 FY26, the company's Net Revenue from Operations stood at INR 432 crore, a significant 19% year-on-year (YoY) increase. This growth translated into a 25% YoY rise in EBITDA to INR 55 crore, with the EBITDA margin expanding by 63 basis points (bps) to 13.2%. Profit After Tax (PAT) also saw a healthy 22% YoY growth, reaching INR 35 crore. The earnings per share (EPS) for H1 FY26 was INR 16.91, reflecting a 21% YoY increase. The company's gross margin improved by 70 bps YoY, supported by a favorable business mix and scale benefits.

Diversified Growth Across Key Verticals

Windlas Biotech's growth story is a testament to its balanced contributions across three primary business verticals: Generic Formulations CDMO, Trade Generics & Institutional, and Exports. The Generic Formulations CDMO vertical, the largest contributor, delivered a steady 18% YoY growth in H1 FY26, driven by strong customer engagement and demand for high-quality manufacturing capabilities. This segment focuses on branded generic products for pharma companies, with Windlas owning the intellectual property rights for 99% of its products.

The Trade Generics & Institutional business gained significant momentum, achieving a 25% YoY growth in H1 FY26. This vertical benefits from an expanding product portfolio and government initiatives like Jan Aushadhi Yojana, which encourage trade generic adoption. The Exports vertical also contributed positively, growing 23% YoY in H1 FY26, reflecting the company's increasing footprint across semi-regulated international markets. The company exports 80 products across 10 countries, focusing on developing and registering product dossiers to secure marketing authorizations.

Strategic Investments and Future Outlook

Windlas Biotech continues to strengthen its manufacturing infrastructure and R&D capabilities. The Plant-2 extension, operational since Q4 FY25, is now meaningfully contributing to the business. The injectable facility has gained further customer approvals, with commercial supplies ramping up across both CDMO and Trade Generics verticals. Furthermore, Plant 6 expansion is advancing well and is on track to be commissioned within FY26, primarily for oral solid dosage (OSD) capacity expansion. The company also highlights its DSIR-approved R&D laboratory, which focuses on developing complex generics and novel dosage formats.

To align employee growth with company performance, Windlas awarded ESOP grants related to the ESOP 2025 scheme in mid-September FY26. This non-cash expenditure, while impacting the P&L from an accounting perspective, is viewed as a strategic investment in retaining key talent and driving long-term shareholder value. The company aims to maintain a Dividend Payout Ratio as near as possible to 20% of its consolidated profit after tax, subject to capital needs for growth and positive cash flow.

Financial Health and Shareholder Returns

Windlas Biotech has significantly improved its liquidity position to INR 237 crore and generated healthy net operating cash flows of INR 56 crore. The company remains Net Debt-free, reflecting disciplined financial management. Its strong Return on Capital Employed (ROCE) of 30% and Return on Equity (ROE) of 27% for H1FY26 further underscore its efficient capital allocation and profitability.

Looking ahead, Windlas Biotech's management is focused on strengthening core capabilities, enhancing efficiencies, and leveraging strong customer partnerships to capture future opportunities. The company's strategy includes expanding its wallet share with marquee clients, targeting new customer acquisitions while mitigating concentration risk, and retrofitting Plant-6 with next-gen capabilities. This forward-looking approach, combined with consistent performance, positions Windlas Biotech for sustained value creation for all stakeholders.