RPG Life Sciences Q4 FY26: A Strong Finish, With Domestic Momentum and API Recovery

RPG Life Sciences ended FY26 with a sharp Q4, helped by faster domestic growth and a visible recovery in its API business. Revenue from operations rose to INR176.9 crore in Q4 FY26, up 23.6% year-on-year. Profitability improved even faster. EBITDA grew 48.0% to INR45.2 crore and EBITDA margin expanded to 25.6% from 21.4%. PAT excluding exceptional items rose 58.1% to INR29.3 crore.

The full year picture was steadier. FY26 revenue from operations increased 8.3% to INR707.5 crore. EBITDA was largely flat at INR172.7 crore, while margins moderated to 24.4% versus 26.4% in FY25. Management linked the margin pressure and the slower full-year trajectory to disruption in the API business after a fire incident, with operations stabilising later in the year.

Market beating domestic growth did the heavy lifting

Domestic Formulations (DF) remains the company’s core profit engine, contributing 68.9% of FY26 sales. DF sales grew 13.7% year-on-year to INR483.5 crore, versus Indian Pharma Market growth of 8.6% for FY26, according to management. In Q4 FY26, the company’s domestic formulations grew 18.2% while the market grew 10.1%, making it one of the faster growers in the quarter and helping improve its IPM rank from 58 to 52.

Management provided a granular split of domestic growth into volume, price and new introductions. For Q4 FY26, domestic growth of 18.2% comprised 9.8% volume growth, 3.3% price growth and 5.1% from new introductions. For FY26, domestic growth of 13.7% comprised 7.0% volume growth, 2.6% price growth and 4.1% from new introductions. Management also stated that around 30% of the domestic portfolio is under DPCO, which structurally limits price-led growth.

A key theme on the call was execution. Management highlighted improvement in sales force productivity to INR6.5 lakhs per representative per month from INR5.7 lakhs last year. In the specialty segment, productivity improved from INR13.2 lakhs to INR16.7 lakhs. The company also cited better sales hygiene and lower expiries and returns, along with higher doctor engagement supported by its proprietary digital platform, RPGserv.

Note: Management stated Q4 FY25 included INR110 crore of exceptional items.

Portfolio strategy: building marquee brands and expanding specialty

RPG Life Sciences continues to anchor its domestic franchise around high-equity legacy brands and a growing specialty and chronic portfolio. The investor presentation highlights leadership in immunosuppressants and a presence across nine therapies including nephrology, rheumatology, oncology, pain management, gastroenterology, neuropsychiatry, cardio-diabeto and urology.

Management called out Naprosyn as a flagship in pain management, growing 24% in Q4 and 15.6% in FY26. The stated goal is to scale Naprosyn into an INR100 crore plus brand, supported by new SKUs and brand architecture work. Immunosuppressants anchored by Azoran and Mofetyl were described as steady performers, with continued focus on therapy expansion and life cycle management.

The presentation’s “Journey Ahead” section also sets a higher ambition for immunosuppressants. It cites a project to grow the immunosuppressant portfolio to 200 crore plus, and also mentions building the company’s MABs portfolio. On the call, management stated that the MAB portfolio recorded 12% growth in Q4.

International Formulations: a softer year, positioned as temporary

International Formulations (IF) contributed 17.6% of FY26 sales, but declined year-on-year. FY26 IF sales were INR123.4 crore versus INR132.3 crore in FY25, a decline of 6.7%. Management attributed this to inventory rationalisation by certain customers and regulatory delays in host countries.

Importantly, management described the inventory correction as a one-time reset. Customers reduced inventory from around 90 to 95 days to 30 to 35 days, which management expects to be the new steady state. The company is also pushing longer-term levers such as onboarding CDMO opportunities and expanding into new markets.

Management listed several emerging markets where registrations are underway, including Myanmar, Vietnam, Philippines, Thailand, Sri Lanka, Egypt, Sudan and South Africa. It also stated that International Formulations has five CDMO projects under development, with three expected in the current year and two in FY28.

APIs: disruption through the year, clear recovery by Q4

The API segment contributed 13.5% of FY26 sales. FY26 API sales grew 5.3% to INR95.1 crore from INR90.2 crore, despite disruption due to a fire incident in one manufacturing block. Management said restoration was completed on time in September 2025, followed by validation.

In Q4, management highlighted API revenue of INR33.3 crore as a “meaningful bounce back” and stated the plant is now fully operational. On profitability, management noted that API margins have historically been around 30% over the last three to four years, and it expects to sustain similar levels, with margin stabilisation already starting as operations normalise.

Balance sheet discipline and capex funded without debt

A consistent positive across the presentation and call was balance sheet conservatism. The company highlighted that it remains debt-free, has healthy cash flows, and has not undertaken debt-funded capex. Management stated it has a cash surplus of approximately INR275 crore, despite investing over INR140 crore of capex over the last four to five years. These investments have supported modernisation and capacity expansion across its three manufacturing facilities.

ICRA reaffirmed the company’s long-term rating at A+ with a stable outlook and its short-term rating at A1. The rating note cited a robust capital structure, strong debt servicing indicators, steady growth in top line, and brand strength in the domestic market.

Key takeaways

RPG Life Sciences delivered a strong Q4 FY26, driven by domestic outperformance and improving profitability, while the full-year result reflects the impact of a major operational disruption in APIs that now appears resolved. Management’s commentary reinforced an execution-led strategy built on volume growth, new launches, digital enablement, and disciplined capital allocation.

Near-term investor monitoring points remain clear from the documents: whether International Formulations returns to growth after the inventory reset, how sustainably API margins revert as the plant runs at normal utilisation, and whether the company can scale its marquee domestic brands such as Naprosyn and the immunosuppressant franchise in line with the stated ambitions.