Zydus Wellness FY26 results: Sales up, profit down

What the latest results show

Zydus Wellness reported a mixed set of numbers for FY26, with strong revenue growth but weaker profitability. In the quarter ended March 2026, net profit fell 5.76% year-on-year to ₹162.0 crore, compared with ₹171.9 crore in the quarter ended March 2025. Over the same period, sales rose 62.10% to ₹1,476.1 crore from ₹910.6 crore. For the full year ended March 2026, net profit declined 43.15% to ₹197.2 crore versus ₹346.9 crore in FY25. Annual sales increased 46.40% to ₹3,940.0 crore from ₹2,691.2 crore.

March quarter: revenue jump, profit slips

The March quarter numbers highlight the key theme investors are tracking: topline strength but pressure on earnings. Sales growth of 62.10% year-on-year indicates a much larger revenue base than a year earlier. But profit did not keep pace, with net profit down 5.76% despite the higher sales. The gap between revenue growth and profit growth suggests higher costs, lower margins, or both during the quarter. The company has also been dealing with integration and acquisition-linked effects during FY26, as reflected in other quarterly disclosures cited in the release.

Full-year FY26: profits down sharply despite higher sales

For FY26, sales grew 46.40% to ₹3,940.0 crore, while net profit fell 43.15% to ₹197.2 crore. That divergence points to material profit headwinds through the year. The year also included quarters with unusually weak profitability, including a reported loss in Q2 FY26 (September 2025 quarter) as provided in the same data set. Investors typically focus on whether the profit decline is a one-off consequence of acquisitions and exceptional costs, or whether it reflects a longer-running margin challenge.

Acquisition-led growth shows up in consolidated Q3 FY26 numbers

The company’s consolidated results for Q3 FY26 (December quarter) showed a sharp rise in revenue, linked primarily to acquisitions. Consolidated revenue for Q3 FY26 was reported at ₹963.3 crore (₹9,633 million), up 108.5% year-on-year, while standalone revenue was ₹141.6 crore (₹1,416 million), up 59.6% year-on-year. Nine-month consolidated revenue for FY26 stood at ₹2,463.9 crore (₹24,639 million), up 38.4% year-on-year. The company attributed the consolidated revenue surge largely to the acquisitions of Naturell (India) Private Limited (NIPL) and Comfort Click Limited (CCL).

Why consolidated profitability turned negative in Q3 FY26

Despite the revenue jump, consolidated net profit in Q3 FY26 was reported as a loss of ₹39.9 crore (₹(399) million), compared with a profit of ₹6.4 crore (₹64 million) in Q3 FY25. The company also disclosed that acquisition-related costs weighed on profitability and that consolidated exceptional items of ₹6.6 crore (₹66 million) were incurred related to the implementation of New Labour Codes. In another set of numbers for the same period, adjusted profit after tax (PAT) for Q3 FY26 was negative at ₹33.3 crore (₹(333) million). The release cited significantly higher finance costs of about ₹37.1 crore (₹371 million) in Q3 FY26 related to a bridge loan for acquisitions, and amortisation expenses of about ₹47.2 crore (₹472 million) for acquired brands.

Margin and EBITDA disclosures for Q3 FY26

The company’s Q3 FY26 disclosure also included profitability indicators at the operating level. Q3 FY26 gross contribution was ₹611.8 crore (₹6,118 million), up 170.3% year-on-year. Gross margins expanded 15.6 percentage points year-on-year to 63.3% in Q3 FY26, and year-to-date FY26 gross margin improved by 6.2 percentage points to 57.5%. Q3 FY26 EBITDA was ₹61.0 crore (₹610 million), up 312.2% year-on-year, with EBITDA margin improving to 6.3% from 3.2% a year ago. However, year-to-date FY26 EBITDA margin was reported at 9.7%, down 0.9 percentage points year-on-year.

Q2 FY26 shock: quarterly loss and margin collapse

The data set also flags the September 2025 quarter (Q2 FY26) as a period of sharp stress. Net profit for Q2 FY26 was a loss of ₹52.8 crore, while revenue was ₹650.5 crore. Operating margin (excluding other income) was 3.58%, compared with 18.14% in Q1 FY26, and PAT margin was -8.21% versus 14.91% in Q1 FY26. Interest cost in Q2 FY26 rose to ₹15.7 crore from ₹2.5 crore in Q1 FY26, and depreciation increased to ₹25.1 crore from ₹10.8 crore. The report also stated that consolidated results for Q2 FY26 showed a net loss of ₹52.8 crore (₹528 million), while standalone results remained profitable with net profit of ₹7.6 crore (₹76 million).

Deal details: NIPL and CCL consolidation timeline

The acquisition details provided help explain the revenue expansion and the near-term cost load. NIPL’s operations were consolidated from September 20, 2025, after its acquisition for ₹390.0 crore (₹3,900 million). CCL’s acquisition was effective from August 29, 2025. The disclosures linked a part of the profitability pressure to acquisition expenses, finance costs on a bridge loan, amortisation of acquired brands, and exceptional items including subsidiary liquidation and labour code implementation costs.

Stock and valuation snapshot from the same data set

The report described Zydus Wellness as a ₹14,325 crore market capitalisation company and said the stock fell 7.63% over the past week. Shares were cited at ₹450.25, with a trailing P/E of about 51 times, and a return on equity (ROE) of 5.88%. It also reported ROCE of 3.34% for H1 FY26, and EV/EBITDA of 38.65 times. The stock was stated to be 15.14% below its 52-week high of ₹530.55 and 50.79% above its 52-week low of ₹298.60.

Key numbers table

What investors are likely to track next

The disclosures point to a business that has scaled up revenue through acquisitions but faced meaningful earnings volatility as financing and amortisation costs rose. The March quarter shows that even with strong sales growth, profits can remain under pressure if costs stay elevated. Separately, the company’s Q2 FY26 loss and weak operating margin provide context for why the market has been sensitive to profitability trends. Future quarterly updates will be watched for the trajectory of finance costs, amortisation, and exceptional items, as well as whether operating margins stabilise. The company has not disclosed margins and EBITDA figures in one part of the announcement, but other sections of the data set do provide margin and EBITDA metrics for Q3 FY26.

Conclusion

Zydus Wellness ended FY26 with strong sales growth in both the March quarter and the full year, but profits fell materially, and some quarters saw sharp earnings swings. The company’s own disclosures link the revenue surge to the NIPL and CCL acquisitions, while the profit pressure is tied to acquisition-related costs, finance charges, amortisation, and exceptional items. Investors will look for clarity in upcoming results on how quickly these costs normalise and how consistently the enlarged business can convert higher revenue into stable earnings.