IOL H1 profit more than doubled as EBITDA margin reached 14.5%

IOL Chemicals and Pharmaceuticals Limited reported standalone H1 FY27 profit after tax (PAT) of Rs 129.5 crore, up from Rs 64.0 crore a year earlier, as revenue from operations rose 38.6% to Rs 1,551.3 crore. Earnings before interest, tax, depreciation and amortisation (EBITDA) increased 69.7% to Rs 226.6 crore, lifting margin to 14.5% from 11.8%.

How did IOL's H1 FY27 profit and revenue change?

IOL reported H1 FY27 standalone revenue from operations of Rs 1,551.3 crore, compared with Rs 1,119.2 crore in H1 FY26, an increase of Rs 432.1 crore or 38.6%. Total revenue, including other income, increased 38.1% to Rs 1,565.0 crore from Rs 1,133.5 crore. Other income declined to Rs 13.7 crore from Rs 14.3 crore despite the increase in revenue from operations.

PAT reached Rs 129.5 crore in H1 FY27, up 102.5% from Rs 64.0 crore in H1 FY26. Profit before tax (PBT) increased 102.2% to Rs 174.0 crore from Rs 86.1 crore, with exceptional items reported at Rs 0.0 crore in both periods. PAT margin increased to 8.3% from 5.6%, a 2.7-percentage-point change.

How did IOL's EBITDA margin increase in H1 FY27?

IOL's EBITDA increased 69.7% year on year to Rs 226.6 crore in H1 FY27 from Rs 133.5 crore, exceeding the 38.6% growth in revenue from operations. EBITDA margin consequently increased to 14.5% from 11.8%. EBIT rose 95.3% to Rs 183.1 crore from Rs 93.8 crore, after depreciation and amortisation expense rose to Rs 43.5 crore from Rs 39.7 crore.

Cost of materials consumed increased to Rs 1,012.1 crore in H1 FY27 from Rs 743.3 crore in H1 FY26. Employee benefits expense rose to Rs 139.9 crore from Rs 121.0 crore, while other expenses increased to Rs 219.2 crore from Rs 146.6 crore. Changes in inventories of finished goods and work in progress were negative Rs 33.5 crore, compared with negative Rs 10.9 crore a year earlier.

How did IOL perform in Q2 FY27?

IOL recorded Q2 FY27 revenue from operations of Rs 795.0 crore, up 40.1% from Rs 567.5 crore in Q2 FY26 and 5.1% from Rs 756.3 crore in Q1 FY27. Q2 total revenue was Rs 800.5 crore, including Rs 5.5 crore of other income. The corresponding Q1 FY27 total revenue was Rs 764.4 crore.

Q2 EBITDA increased 79.6% year on year to Rs 114.9 crore from Rs 64.0 crore, and EBITDA margin rose to 14.4% from 11.1%. EBITDA was 2.8% above Rs 111.7 crore in Q1 FY27, although the Q1 margin was 14.6%. Q2 PAT was Rs 65.0 crore, up 116.8% from Rs 30.0 crore a year earlier and 0.9% from Rs 64.5 crore in Q1 FY27.

Which IOL segments contributed to H1 FY27 growth?

IOL's pharmaceuticals segment generated H1 FY27 revenue of Rs 942.2 crore and EBIT of Rs 136.9 crore, compared with Rs 665.7 crore and Rs 75.5 crore, respectively, in H1 FY26. Revenue increased by Rs 276.5 crore and EBIT increased by Rs 61.4 crore. In Q2 FY27, pharmaceuticals revenue was Rs 472.8 crore and EBIT was Rs 68.1 crore, compared with Rs 469.5 crore and Rs 68.8 crore in Q1 FY27.

Chemicals revenue, stated net of intersegment sales, reached Rs 609.1 crore in H1 FY27 from Rs 453.5 crore in H1 FY26. Chemicals EBIT increased to Rs 40.5 crore from Rs 11.0 crore over the same comparison. In Q2 FY27, chemicals revenue was Rs 322.3 crore and EBIT was Rs 23.2 crore, above Q1 FY27 revenue of Rs 286.8 crore and EBIT of Rs 17.3 crore. IOL reported that H1 FY27 revenue was 72% domestic and 28% exports.

What do IOL's balance sheet and cash flows show?

IOL reported total assets of Rs 2,830.4 crore at Sep 26, compared with Rs 2,586.7 crore at Mar 26. Property, plant and equipment rose to Rs 1,170.5 crore from Rs 1,165.1 crore, while capital work in progress increased to Rs 189.4 crore from Rs 93.6 crore. Inventories rose to Rs 464.4 crore from Rs 371.1 crore and trade receivables increased to Rs 689.2 crore from Rs 603.1 crore.

Cash and cash equivalents were Rs 9.2 crore at Sep 26, down from Rs 65.3 crore at the beginning of the year. Net cash from operating activities was Rs 8.3 crore for Sep 26, compared with Rs 11.1 crore for Sep 25, while cash flow from investing activities was negative Rs 116.8 crore. Current borrowings rose to Rs 194.2 crore at Sep 26 from Rs 132.0 crore at Mar 26, and total equity increased to Rs 1,925.5 crore from Rs 1,798.4 crore.

Conclusion

IOL's H1 FY27 results combined 38.6% growth in revenue from operations with faster increases in EBITDA, EBIT and PAT. Pharmaceuticals generated Rs 136.9 crore of segment EBIT and chemicals generated Rs 40.5 crore, compared with Rs 75.5 crore and Rs 11.0 crore, respectively, a year earlier. The reported result was a 14.5% EBITDA margin and PAT of Rs 129.5 crore.

The next disclosed milestones are IOL's Rs 495 crore planned investment across three projects, to be funded through internal accruals. Management expects commercialisation of the pharmaceutical formulations contract development and manufacturing organisation project and the specialty-chemicals tolling project in FY27, while the 6,000 metric-tonne-per-annum ibuprofen capacity expansion is expected to be commercialised in FY28.