Bharat Parenter.

Standalone revenue from operations for Q2 FY26 was ₹41.7 crores, a significant decline from ₹64.5 crores in Q2 FY25 and ₹94.4 crores in Q1 FY26. This decline was anticipated due to a planned one-month production break for facility upgrades, temporary softness^📎 in institutional offtake, and deferred export dispatches. Despite lower volumes, standalone gross margins expanded sharply to 44.1% from 33.5% last year, reflecting a shift towards higher-value products and improved efficiency. Standalone EBITDA stood at ₹2.3 crores (5.6% margin) and PAT at ₹2.7 crores (6.5% margin), demonstrating continued profitability.

On a consolidated basis, revenue for Q2 FY26 was ₹64.6 crores, representing a 10% year-on-year decline and a 44% sequential drop. However, the underlying performance showed significant strengthening, with consolidated gross profit rising 26% year-on-year to ₹37.7 crores. Consolidated gross margins expanded notably to 58.3% from 41.8% in the previous year, primarily driven by a favorable product mix and procurement discipline. Consolidated EBITDA turned positive at ₹80 lakhs, a substantial improvement from a loss of ₹7.7 crores in Q2 FY25, and net loss nearly halved to ₹8.6 crores.

Innoxel Lifesciences achieved a major milestone by receiving the US FDA Establishment Inspection Report (EIR) on July 30, 2025, confirming its approved status for the Vadodara manufacturing facility. This approval is transformational, enabling commercial supplies to the US and EU markets. During the quarter, Innoxel also finalized seven new strategic partnerships, including six EMO contracts and one out-licensing deal, collectively valued at $1.85 million in licensing and milestone income. The subsidiary's pipeline now includes approximately 20 active products, with over 40 molecules under lifetime development, and it expects an EU GMP inspection in H2 FY26.

Varenyam Healthcare, the domestic formulations arm, continues its strong performance, focusing on critical care and anesthesia segments. The division is on track to achieve ₹60-65 crores in revenue for FY26, representing a healthy 20-21% year-on-year growth. It is also expected to deliver a 10% PAT margin on its top line for the year. The anesthesia division, a core competency, has seen its margins expand from 39% last year to 45% in H1 FY26, with management aiming to maintain these levels in H2.

The company undertook significant infrastructural upgrades, including the conversion of its general injectables line to higher ORABS standards and improvements to purified water systems in the Beta-Lactam Block. These upgrades were part of a strategic long-term plan to ensure compliance with stringent regulatory requirements for upcoming EU GMP and PIC/S audits. Management remains confident of a strong rebound in H2 FY26 for the standalone business, maintaining FY26 revenue growth guidance of 12-14% and EBITDA margins of 15-17%, supported by a robust order book and improved utilization. Innoxel is projected to achieve EBITDA breakeven in FY26 and deliver ₹110-135 crores in revenue by FY27.