Granules India Q2 profit rises 39% as revenue reaches Rs 1,560 crore

Granules India Limited reported profit after tax of Rs 181.8 crore for Q2FY27, up 39% year-on-year, while revenue from operations rose 20% to Rs 1,560 crore in the quarter ended September 30, 2026. Granules India said this performance came despite higher input and West Asia-related logistics costs.

How did Granules India perform in Q2FY27?

Granules India increased revenue from operations to Rs 1,560 crore in Q2FY27 from Rs 1,297 crore in Q2FY26, a 20% year-on-year increase, and from Rs 1,476.8 crore in Q1FY27, a 6% sequential increase. Dr. Krishna Prasad Chigurupati, Chairman and Managing Director, said quarterly revenue crossed Rs 1,500 crore in Q2FY27. The quarter ended September 30, 2026, and the results were announced on November 2, 2026.

Profitability rose faster than sales on a year-on-year basis. Earnings before interest, tax, depreciation and amortisation, or EBITDA, increased 21% to Rs 337.6 crore from Rs 278.2 crore, while profit before tax grew 38% to Rs 243.4 crore from Rs 175.9 crore. Profit after tax, or PAT, rose to Rs 181.8 crore from Rs 130.6 crore. EBITDA margin was 22%, compared with 21% a year earlier, and PAT margin was 12%, compared with 10%.

The sequential comparison shows a different pattern: revenue rose 6% from Q1FY27, but EBITDA was reported flat and declined in absolute terms from Rs 338.9 crore to Rs 337.6 crore. EBITDA margin moved to 22% from 23% in the preceding quarter. Yet profit before tax increased 1% sequentially from Rs 240.4 crore, and PAT also rose 1% from Rs 180 crore, leaving PAT margin unchanged at 12%.

Which markets and businesses generated Q2FY27 revenue?

Granules India derived 72% of Q2FY27 revenue from North America, down from 76% in Q2FY26, while Europe accounted for 16%, up from 12% a year earlier. The disclosed regional mix indicates that Europe contributed a larger share of the Rs 1,560 crore quarterly revenue, while North America remained the principal market despite its lower percentage share.

Finished dosages, or FD, supplied 73% of Q2FY27 revenue, making them Granules India’s largest reported business category. Active pharmaceutical ingredients, or API, represented 13%, pharmaceutical formulation intermediates, or PFI, accounted for 10%, and peptide contract development and manufacturing organisation, or CDMO, work contributed 3%. The disclosed shares add to 99%.

Granules India described its operating model as vertically integrated across APIs, PFIs, finished dosages and peptide CDMO. Management said it continues to shift towards complex generics and peptide CDMO, alongside filing two potential first-to-file abbreviated new drug applications, or ANDAs, in the first half of FY27. Those two filings took the total number of potential first-to-file ANDAs cited by management to three.

What cost pressures did Granules India identify?

Granules India said higher input costs and logistics costs linked to tensions in West Asia affected the Q2FY27 operating environment, even as EBITDA rose 21% year-on-year to Rs 337.6 crore. Dr. Chigurupati said the cost pressures would persist and that management was working with customers to manage them with a lag. The release did not quantify the input-cost increase or specify a timetable for customer recoveries.

The margin data captures the immediate result of those pressures across two comparisons. EBITDA margin improved by 1 percentage point year-on-year, from 21% in Q2FY26 to 22% in Q2FY27, alongside the 20% revenue increase. Sequentially, however, the margin declined by 1 percentage point from 23% in Q1FY27 to 22%, while revenue increased by Rs 83.2 crore over the same period.

Management linked its response to customer engagement rather than announcing a stated price increase or cost target. It also said the Rs 828 crore net cash position would be available for research and development, manufacturing and quality investments. The filing contains forward-looking cautions that actual results may differ due to economic, business, competitive, technological or regulatory factors.

How did Granules India’s balance sheet and regulatory update change?

Granules India ended Q2FY27 with net cash of Rs 828 crore, compared with net debt of Rs 101.2 crore at the end of Q1FY27. This represents a shift of Rs 929.2 crore between the two reported positions. Management attributed the Q2FY27 net-cash balance to receipt of the remaining warrant proceeds, and said the funds could be invested in research and development, manufacturing and quality.

Return on capital employed, or ROCE, was 17.6% in Q2FY27, which Granules India said was in line with FY26. The release did not provide a quarterly ROCE figure for Q1FY27 or Q2FY26, so no sequential or year-on-year calculation can be made from the disclosed data. The stated 17.6% measure therefore provides a comparison with the full FY26 level only.

Granules India also said it recently concluded a US Food and Drug Administration, or US FDA, audit at its Gagillapur site. Management described the inspection as constructive and said it believed the observations could be fully addressed through responses and corrective and preventive actions. The announcement did not state the number of observations, their classification, or a date for the agency’s next action.

Conclusion

Granules India converted 20% year-on-year revenue growth in Q2FY27 into a 39% rise in PAT, with profit reaching Rs 181.8 crore and EBITDA reaching Rs 337.6 crore. The quarter also showed a changed regional mix, with Europe’s share rising to 16%, and a balance-sheet move from Rs 101.2 crore of net debt in Q1FY27 to Rs 828 crore of net cash.

The next issues to watch are management’s stated effort to manage continuing input and West Asia-linked logistics costs with customers, deployment of the Rs 828 crore net-cash position into research and development, manufacturing and quality, and progress on the three potential first-to-file ANDAs. Granules India also plans to continue engaging with the US FDA on corrective and preventive actions at the Gagillapur site.