Fredun Pharma — Q4 FY26 earnings call

Call held 10 Jun 2026

Management summary

Fredun Pharmaceuticals reported a strong Q4 and full FY26, driven by robust revenue growth and significant margin expansion across its businesses. The company saw impressive performance in its new age segments like Pet Care and Mobility, alongside the successful launch of new hormonal and anti-aging product lines. While raw material costs increased due to geopolitical factors, management indicated effective mitigation strategies, and cash flows improved despite ongoing working capital needs.

Highlights

  • Strong revenue growth in Q4 FY26 (27.27% YoY) and full FY26 (40.08% YoY).

  • Significant EBITDA margin expansion in Q4 FY26 (+326 bps to 13.67%) and full FY26 (+276 bps to 14.83%).

  • Robust net profit growth in Q4 FY26 (56.47% YoY) and full FY26 (59.59% YoY).

  • Successful launch and strong response for new hormonal and anti-aging product lines.

  • Mobility division showing phenomenal growth and targeting INR 100 crores run rate within 2-2.5 years.

Concerns

  • Geopolitical issues led to raw material cost increases, though management stated they managed it through buffer stock and forward orders.

  • Working capital requirements remain a focus, but management asserts improved cash flows and planned management.

Key financials

2 periods

Q4 FY26

  • Total Income
    ₹213 Cr
    YoY +27.3%
  • EBITDA
    ₹29.13 Cr
    YoY +67%
  • EBITDA Margin
    13.7%
  • Net Profit
    ₹11.07 Cr
    YoY +56.5%
  • Net Profit Margin
    5.2%

FY26

  • Total Income
    ₹639.12 Cr
    YoY +40.1%
  • EBITDA
    ₹94.79 Cr
    YoY +72%
  • EBITDA Margin
    14.8%
  • Net Profit
    ₹33.21 Cr
    YoY +59.6%

What they filed

Q1 FY27: revenue up 90.0%, net profit up 85.7% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue107 103 167 120 145 +36%161 +56%213 +28%228 +90%
EBITDA14 13 17 17 22 +57%26 +100%29 +71%33 +94%
Net profit4 5 7 7 10 +150%10 +100%11 +57%13 +86%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Vintage Business
    15% Growth₹115 Cr Exports Revenue₹24 Cr Tolling Revenue₹125 Cr Indirect Exports/Institution Sales Revenue₹47.5 Cr Domestic Third-Party Branding Revenue₹27.5 Cr Fredun DC Revenue
  • New Age Business
    0.45 cagr Growth₹42.5 Cr Pet Care Revenue₹29.5 Cr Mobility Revenue₹26 Cr Nutraceuticals Revenue₹21 Cr Mass Market Cosmetics Revenue₹12 Cr Cosmetics Revenue45% Gross Margin80% Dermaceutics Gross Margin50% Hormones Gross Margin

Order book

high confidence

Total value

₹325 Cr

as of 2026-03-31 range

Execution

6 to 7 months

The company maintains a consistent order book of 6-7 months, which helped mitigate raw material price increases.

Source: Prepared remarks

Capital allocation

medium confidence
  • Debt Debt disclosed
    Debt-to-equity is 0.8.
  • Liquidity Liquidity disclosed Cash flows have improved, with positive cash flows from operations.
    Now the cash flows have improved, we have positive cash flows even from our operations as we speak.

Guidance & targets

Volume

  • Mobility Division Run Rate Volume · within 2 to 2.5 years · High confidence INR 100 crores
    We do not foresee any problem in touching INR100 crores within a 2 to 2.5 years from now, calendar 2.5 calendar years from now and INR100 crores run rate.

    — Fredun Medhora, Managing Director

Other

  • Mobility Division Enterprise Value Other · within the next 5 to 7 years · High confidence INR 250-300 crores
    We are looking at easily within the next 5 to 7 years, INR250 crores to INR300 crores enterprise coming out of this.

    — Fredun Medhora, Managing Director

  • Pet Care Market Dominance Other · by 2032, 2033 · Low confidence no pet in India can be born or die without using a Freossi product or service
    Our goal our long-term goal is very crystal clear substant and simple that by 2032, 2033, no pet in India can be born or die without using a Freossi product or service.

    — Fredun Medhora, Managing Director

Revenue

  • Mobilitics Revenue Revenue · in the next 2 years · High confidence INR 30-40 crores
    Hopefully, that alone should go into INR30 crores to INR40 crores in the next 2 years, just the Mobilitics part of Fredun Mobility.

    — Fredun Medhora, Managing Director

  • Mobilitics CAGR Revenue · High confidence 55-60%
    growing at almost 55% to 60% CAGR.

    — Fredun Medhora, Managing Director

  • Overall Top Line Growth Revenue · FY27 · High confidence 25-30%
    We can consider a growth and overall growth of around 25% to 30% on our top line from the last year.

    — Fredun Medhora, Managing Director

Profitability

  • PAT Margin Profitability · within the next few years · Medium confidence 10-12%
    within the next few years, you're easily looking 10% to 12% PAT kind of company on a 2x, 3x kind of top line within the next few years.

    — Fredun Medhora, Managing Director

Capacity

  • Manufacturing Plant Ranking Capacity · within the next 2.5 years · Medium confidence top 3, top 4 manufacturing plants
    within the next 2.5 years, we should be in the top 3, top 4 manufacturing plants for capacities at a certain location.

    — Fredun Medhora, Managing Director

Product Mix

  • New Age Business Percentage of Total Product Mix · within the next few years · Medium confidence 50% each
    the percentage of the business will come to around 50% each. And within the next 2, 3 years post that, it will be around 70% to 30%.

    — Fredun Medhora, Managing Director

What to watch in Q1 FY27

Mobility division run rate

Next 2-2.5 years (check progress in Q1 FY27)
Current ~INR 30 crores (FY26)
Target Progress towards INR 100 crores

Why it matters

Key growth driver for new age business, indicates successful scaling.

Last year, we did around almost INR30 crores of mobility products... We do not foresee any problem in touching INR100 crores within a 2 to 2.5 years from now

Risks & concerns

  • Working capital requirements for growth

    medium

    Working capital needs are a focus, but management states cash flows have improved, and it was a planned decision, with the company now positive on cash flows.

    Analyst acknowledged

  • Raw material cost inflation due to geopolitical issues

    low

    Geopolitical issues led to increased raw material costs, but management mitigated the impact through buffer stock and forward orders, which even led to increased sales.

    Analyst acknowledged

Q&A highlights

8 direct
New product lines (DAULCEL and Hormonal products) strategy Direct
We are launching 2 sets. One is a hormonal line and the other is an anti-aging line... We will be 1 of the first or the second in the country to have those products.

Details the company's entry into high-margin, fragmented markets with unique products and a direct-to-doctor/online strategy.

Asked by Keshav Toshniwal

Mobility division growth strategy and scaling Direct
Mobility has been a very positive division for us. We have seen phenomenal growth. Last year, we did around almost INR30 crores of mobility products... We do not foresee any problem in touching INR100 crores within a 2 to 2.5 years from now.

Provides specific growth numbers and future targets for a key new age business segment, highlighting its profitability and distribution advantage.

Asked by Vinod Shah

Pet care business aspirations, product range, and services Direct
Our goal our long-term goal is very crystal clear substant and simple that by 2032, 2033, no pet in India can be born or die without using a Freossi product or service.

Outlines an ambitious long-term vision for the pet care segment, emphasizing a comprehensive product lifecycle approach and unique offerings like Jain biscuits and specialized grooming products.

Asked by Pritesh Vohra

Impact of geopolitical issues on raw material costs and pricing power Direct
I always say, no matter how many bombs fall, no matter how many things people have to take their heart pills. So the -- yes, of course, the prices have increased. But there in because we always used to keep 3 to 4 months of stock, that initial jolt of that price increase never bothered us.

Addresses a critical macro concern, demonstrating management's proactive inventory strategy that mitigated the impact of rising raw material costs and even led to increased sales.

Asked by Ankit

Revenue breakup between vintage and new age businesses Direct
Our vintage business... is growing at around 15% to 20% year-on-year... Our new age business... are growing at around 40% to 50% CAGR because they are coming from a smaller base.

Provides a clear breakdown of revenue contributions and growth rates for different business segments, highlighting the higher growth and margins in the newer segments.

Asked by Nikhil Agarwal

Drivers of margin improvement and sustainability Direct
Our margins have improved because since 2016, I have been saying post INR50 crores a quarter revenue, the economies of scale in the vintage business will start hitting in and that is exactly what happened in 2021, 2022.

Explains the underlying reasons for margin expansion, attributing it to economies of scale in the vintage business and higher gross margins from the growing new age businesses.

Asked by Nishita Shanklesha

Manufacturing capacity utilization and in-house production strategy Direct
Right now, I would say about 80% of our products or more than 80% gets manufactured in-house. In-house capacities are augmented. They are expanding. Even as we speak, we are adding another 12 to 13 packing lines by end of September.

Details the company's strong in-house manufacturing capabilities and ongoing expansion plans, which are crucial for quality control, cost efficiency, and future growth.

Asked by Nikhil Agarwal

Working capital requirements and cash flow management Direct
Now the cash flows have improved, we have positive cash flows even from our operations as we speak. Working capital is not a worry for us right now... We have done well. We are now positive.

Addresses investor concerns about working capital, with management confirming improved cash flows and a strategic approach to managing working capital for growth.

Asked by Devang Shah

3 min read 7 chapters

Detailed narrative

Q4 & FY26 Performance Overview

Fredun Pharmaceuticals delivered a strong financial performance for Q4 and full FY26. Total income for Q4 FY26 grew by 27.27% year-on-year to INR 213 crores, with EBITDA increasing by 67.05% to INR 29.13 crores, leading to a margin expansion of 326 basis points to 13.67%. Net profit for the quarter rose by 56.47% to INR 11.07 crores. For the full FY26, total income reached INR 639.12 crores, marking a 40.08% year-on-year growth, and EBITDA stood at INR 94.79 crores, up 72.05% with a margin of 14.83%.

New Product Launches: Hormonal & Anti-aging Lines

The company is launching two new product sets: a hormonal line and an anti-aging line. These products are targeted through the doctor channel, with Fredun aiming to be among the first in the country to offer certain hormonal products and specialized anti-aging solutions. The anti-aging segment, particularly NAD/NAD+, is seeing rapid growth, and Fredun holds exclusive import rights for its API, leveraging its dermaceutic and specialized product capabilities.

Mobility Division Growth Strategy

The Mobility division, encompassing brands like BraceOn, Digion, and NebOn, has shown phenomenal growth, achieving approximately INR 30 crores in FY26. Management projects this division to reach an INR 100 crores run rate within 2 to 2.5 years and an enterprise value of INR 250-300 crores within 5 to 7 years. The strategy leverages existing distribution channels used for pharma products, providing a competitive advantage over pure mobility players.

Pet Care Business Vision & Strategy

Fredun Pharmaceuticals has an ambitious long-term vision for its pet care business, aiming for no pet in India to be born or die without using a Freossi product or service by 2032-2033. The company is launching 42 variants of functional food biscuits, including novel Jain biscuits, and has developed a strong range of grooming products. The strategy focuses on educating first-line influencers like breeders and groomers, and the company's online platform, Wagr.in, is set for launch by early July, designed as a holistic pet care portal.

Raw Material Costs & Geopolitical Impact

Despite geopolitical issues leading to increased raw material costs, Fredun Pharmaceuticals successfully navigated the challenge. Management stated that maintaining 3-4 months of buffer stock and having orders in hand for 6-7 months (upwards of INR 320-330 crores) allowed them to absorb initial price shocks without significant impact on profitability. This proactive inventory management and forward ordering strategy even contributed to increased sales.

Manufacturing Capacity & In-house Production

The company emphasizes its strong in-house manufacturing capabilities, with over 80% of its products currently manufactured internally. Fredun is actively augmenting its capacities, planning to add 12 to 13 packing lines by the end of September and constructing a new wing within its plant. Management aims for Fredun to be among the top 3-4 manufacturing plants in terms of capacity at certain locations within the next 2.5 years, leveraging its three decades of experience and high CoPPs.

Working Capital Management & Cash Flow

Addressing investor concerns about working capital, management confirmed that cash flows have significantly improved, with the company now generating positive cash flows from operations. The debt-to-equity ratio stands at 0.8, and management asserted that working capital is not a current concern, highlighting that the improved numbers and strategic management of working capital were part of a planned decision to support rapid organic growth.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Healthcare earnings calls