Poly Medicure Navigates Q2 FY26 with Strategic Acquisitions and Innovation

Poly Medicure Limited, a prominent player in the medical devices sector, has unveiled its consolidated financial performance for Q2 and H1 FY26, demonstrating a strategic pivot towards inorganic growth and sustained innovation amidst evolving market dynamics. The company reported a consolidated revenue of Rs. 443.9 crores for Q2 FY26, marking a 5.7% year-on-year (YoY) increase. For the first half of the fiscal year, H1 FY26, revenue stood at Rs. 847.1 crores, reflecting a 5.3% YoY growth. Despite a slightly lower revenue growth compared to initial projections, Poly Medicure successfully improved its gross profit margins and maintained operating EBITDA within its guided range, underscoring resilient operational management.

Performance Highlights and Segmental Dynamics

The company's Q2 FY26 performance was characterized by robust domestic growth, which saw a 17-18% YoY increase, driven by effective strategy execution and rising local demand. The private business segment, in particular, exhibited strong momentum with a 22.3% YoY growth. However, the Renal segment experienced a growth of 18.1% in Q2, which was lower than expected due to inventory realignment necessitated by GST changes in early September. This temporary disruption impacted the segment's otherwise strong trajectory.

Internationally, Poly Medicure faced a more challenging environment. European operations witnessed a slight degrowth of 9.6% YoY in Q2 FY26, attributed to inventory adjustments and increased competition. The US market also presented headwinds, primarily due to prevailing tariff situations and the US FDA's stance on disapproving Indian lab results, which has necessitated retesting of products and consequently delayed approvals. Despite these challenges, the company's Rest of World (RoW) markets showed promising growth, expanding by approximately 13% YoY sequentially.

Here is a financial summary of Poly Medicure's consolidated performance:

Strategic Acquisitions and Future Outlook

A cornerstone of Poly Medicure's recent strategy has been its aggressive inorganic growth. The company successfully closed two significant acquisitions: PendraCare Group in the Netherlands, a specialist in interventional cardiology solution catheters, and Citieffe Group in Italy, a leading player in the orthopaedic trauma and extremity business. These acquisitions are pivotal to Poly Medicure's strategy of expanding into high-growth, adjacent medical device segments and strengthening its global footprint, particularly in Europe. Combined, these two entities are projected to add approximately Rs. 280 crores to Poly Medicure's annual revenue, significantly broadening its addressable market.

Management has provided a forward-looking guidance for H2 FY26, anticipating revenue between Rs. 1,080 crores and Rs. 1,090 crores, which would represent a substantial 25% increase over H1 FY26. For the full fiscal year 2026, the company projects an overall revenue growth of 15-16%. While this is a slight revision from the initial 20% guidance, it reflects a pragmatic approach to current global macroeconomic headwinds and regulatory complexities. The operating EBITDA margin is expected to remain robust, within the 25-27% range for the full year, supported by improved gross margins and operational efficiencies.

Innovation, Capacity Expansion, and Sustainability

Poly Medicure's commitment to innovation is evident through its continuous R&D efforts. The company launched 8 new products in Q2 FY26 and maintains a strong R&D team of approximately 80 professionals. A significant pipeline of 20 new products is slated for CE marking in Europe by calendar year 2026, targeting new MDR regulations, and over 20 new products have been introduced in the Critical Care segment over the last 12 months. This focus on new product development is crucial for driving future growth and capturing market share in advanced medical technologies.

To support its growth trajectory, Poly Medicure has planned a CAPEX of over Rs. 250 crores for FY26, primarily for capacity expansion at its facilities in Mitral and Haridwar. These new plants are expected to be fully operational within the next 12-18 months, ensuring adequate manufacturing capabilities to meet increasing domestic and international demand. The company's strong liquidity position, with Rs. 1,109 crores in cash and cash equivalents (Rs. 800 crores net cash after acquisitions), provides ample financial flexibility to fund these organic and inorganic growth initiatives.

Poly Medicure is also investing in digital transformation and sustainability. The expansion of its AI-powered SARATHII program aims to enhance sales training efficiency and engagement. Furthermore, the company is committed to environmental stewardship, with approximately 70% of its facilities ISO 14001:2015 certified, and initiatives like 9.9 MWp solar energy projects targeting a 28% reduction in scope-2 emissions. These efforts underscore a holistic approach to business growth, integrating financial performance with technological advancement and environmental responsibility.

Conclusion: Strategic Clarity Amidst Challenges

Poly Medicure Limited's Q2 and H1 FY26 performance reflects a company with strategic clarity, actively pursuing growth through both acquisitions and organic innovation. While navigating global economic uncertainties and specific market challenges, the company's focus on expanding its product portfolio, strengthening its R&D capabilities, and enhancing manufacturing capacity positions it for sustained long-term growth. The management's transparent communication and proactive measures to address market realities instill confidence in its ability to execute its vision and deliver value to stakeholders.