Aurobindo Pharma closes Lannett deal, books Rs 460.27 crore goodwill

Aurobindo Pharma Limited completed its acquisition of Lannett Company LLC on June 29, 2026 for $245.7 million, provisionally recognising Rs 460.27 crore of goodwill and Rs 1,861.57 crore of fair value for net assets acquired. Lannett has been consolidated from the acquisition date, making the September 2026 quarter and half-year results non-comparable with earlier periods.

What did Aurobindo Pharma acquire from Lannett?

Aurobindo Pharma acquired 100% membership interest in Lannett Company LLC and its subsidiaries on June 29, 2026. The acquired entities are Silarx Pharmaceuticals Inc, Kremmers Urban Pharmaceuticals Inc and Cody Laboratories Inc, according to the company’s filing.

The transaction followed a definitive agreement signed on July 30, 2025 by Aurobindo Pharma USA, Inc, a wholly owned subsidiary of Aurobindo Pharma. The filing says the deal closed after customary closing conditions were met and necessary regulatory approvals were received, with purchase consideration of Rs 2,321.83 crore, equivalent to $245.7 million.

Aurobindo Pharma consolidated Lannett and its subsidiaries from June 29 rather than for the full quarter ended September 30, 2026. The group has one reportable segment, pharmaceuticals, and does not disclose Lannett’s separate revenue, profit, product sales or geographical performance in the results.

How did Aurobindo Pharma account for the Lannett acquisition?

Aurobindo Pharma accounted for the transaction under Indian Accounting Standard 103, Business Combinations, and provisionally measured net assets acquired at Rs 1,861.57 crore. It recognised Rs 460.27 crore of goodwill, with the company stating that the initial accounting remains provisional.

The provisional treatment means the purchase-price allocation has not been finalised in the disclosed September 2026 results. The filing does not identify the individual assets and liabilities underlying the Rs 1,861.57 crore net-asset value, nor does it state a date by which the initial accounting will be completed.

Goodwill in Aurobindo Pharma’s consolidated balance sheet rose to Rs 1,268.62 crore at September 30, 2026 from Rs 800.15 crore at March 31, 2026, an increase of Rs 468.47 crore. The increase exceeded the Rs 460.27 crore Lannett goodwill recognised, and the filing does not explain the remaining movement in the goodwill balance.

Aurobindo Pharma also recorded Rs 40.18 crore of Lannett acquisition and related costs in the half year ended September 30, 2026. The company classified this amount as an exceptional item, separately from the provisional measurement of the acquired net assets and goodwill.

Why are Aurobindo Pharma’s September 2026 results not comparable?

Aurobindo Pharma said its quarter and half year ended September 30, 2026 are not comparable with earlier periods because Lannett was consolidated from June 29, 2026. The corresponding quarter and half year ended September 30, 2025 did not include any Lannett results.

Revenue from operations for the quarter ended September 30, 2026 was Rs 10,263.29 crore, compared with Rs 8,285.70 crore a year earlier and Rs 9,150.35 crore in the quarter ended June 30, 2026. Profit after tax was Rs 1,123.84 crore, versus Rs 848.13 crore in the September 2025 quarter and Rs 1,032.03 crore in the June 2026 quarter.

For the half year ended September 30, 2026, revenue from operations increased to Rs 19,413.64 crore from Rs 16,153.84 crore a year earlier. Profit after tax rose to Rs 2,155.88 crore from Rs 1,672.33 crore, but the filing does not quantify how much of either change came from Lannett versus Aurobindo Pharma’s existing pharmaceutical operations.

The comparative issue applies to both the September quarter and the first half because consolidation began two days before the June 2026 quarter closed. The filing provides no pro forma revenue or profit figures that would show results as if Lannett had been owned throughout either reported period.

What changed in Aurobindo Pharma’s balance sheet after the closing?

Aurobindo Pharma reported total assets of Rs 61,754.29 crore at September 30, 2026, up from Rs 58,502.15 crore at March 31, 2026. Alongside goodwill rising by Rs 468.47 crore, other intangible assets increased to Rs 3,404.64 crore from Rs 2,276.50 crore.

Property, plant and equipment stood at Rs 14,829.76 crore at September 30, 2026, compared with Rs 13,955.20 crore six months earlier. These balance-sheet movements occurred during the half year in which Lannett was acquired, although the filing does not attribute individual increases in fixed or intangible assets to the transaction.

Current borrowings increased to Rs 7,251.82 crore at September 30, 2026 from Rs 6,873.45 crore at March 31, 2026, while non-current borrowings rose to Rs 981.93 crore from Rs 802.75 crore. The company does not state in the filing that the higher borrowings were used to fund the Rs 2,321.83 crore Lannett consideration.

Cash and cash equivalents declined to Rs 6,231.51 crore at September 30, 2026 from Rs 7,191.40 crore at March 31, 2026. The half-year cash-flow statement reports cash and cash equivalents of Rs 6,221.45 crore for cash-flow purposes after including an overdraft of Rs 10.06 crore.

What other actions did Aurobindo Pharma disclose during the half year?

Aurobindo Pharma transferred its domestic branded generic pharmaceutical formulations products business to wholly owned subsidiary Auropharm Limited from April 1, 2026 for Rs 143.21 crore. The company said the transaction had no impact on consolidated financial statements because it was completed within the group.

The board approved a buyback of 54,23,728 equity shares in April 2026, representing 0.93% of the parent company’s total equity shares, at a maximum price of Rs 1,475 per share. The company reported an aggregate payment of Rs 805.80 crore, including related expenses, and said paid-up equity share capital was reduced by Rs 5.40 crore after the shares were extinguished.

On November 4, 2026, the board declared an interim dividend of Rs 7 per equity share with a face value of Rs 1. The same meeting approved the unaudited consolidated results for the quarter and half year ended September 30, 2026, for which the statutory auditors issued an unmodified limited-review conclusion.

Conclusion

Aurobindo Pharma has completed the Lannett acquisition and added the acquired companies to its consolidated accounts from June 29, 2026. The Rs 2,321.83 crore purchase created Rs 460.27 crore of provisional goodwill, while the group’s reported revenue and profit increased year on year in the September quarter and half year, periods the company says are not comparable with earlier results.

The key item to watch is the finalisation of the provisional purchase accounting under Indian Accounting Standard 103, including any revision to the Rs 1,861.57 crore fair value of net assets acquired or the Rs 460.27 crore goodwill amount. Aurobindo Pharma has not disclosed a timetable for completion or separately reported Lannett’s revenue and profit contribution.