Detailed Narrative
FY26 Financial Performance Overview
Avience Biomedicals reported a consolidated revenue from operations of ₹52.51 crore for FY26, marking a 16.06% increase from ₹45.24 crore in FY25. The company's EBITDA margin improved significantly to 28.45% in FY26, up from 25.35% in the previous year. Profit after tax also saw robust growth, increasing by 23.31% to ₹8.75 crore in FY26, compared to ₹7.10 crore in FY25. This consistent improvement demonstrates the underlying strength and scalability of the business model.
New Manufacturing Facility and Capacity Expansion
The company's new manufacturing facility is substantially complete, with the remaining work expected to finish by September 2026, and manufacturing targeted to commence from October 2026. This new facility is crucial for supporting a substantially larger scale, with a potential peak revenue capacity of approximately ₹250-265 crore. The initial utilisation in FY27 is projected to be around 15-20%, and it will enable the company to participate in larger private and government tenders, which were previously limited by manufacturing scale.
Product Portfolio and Approvals
Avience currently holds 88 product licences and has over 200 products in its development and approval pipeline. Management expects to have approximately 175 approved products by the end of FY27. The normal approval timeline for products is 6-9 months, though the company has achieved approvals in approximately three months in several cases, demonstrating efficiency in navigating regulatory processes.
Strategic Shift in Manufacturing and Distribution Mix
The company's current manufacturing and trading mix stands at approximately 30:70. However, with the new facility scaling up, Avience is targeting a shift to a mix closer to 50:50, aiming to increase in-house manufacturing. This strategic shift is expected to support margin improvement, as manufacturing margins can range from 30% to over 70% depending on the product and model, such as the reagent-rental model.
Working Capital Management and Funding
For a revenue target of ₹100 crore, the working capital requirement is estimated to be ₹35-40 crore. The company is actively evaluating debt funding, cash-credit limits, collateral-backed facilities, and bill discounting to meet this need. Discussions with bankers have indicated their readiness to provide suitable facilities once confirmed orders are in place, which is critical given the long receivable cycles (45-120 days) for government tenders.
Growth Outlook and Export Focus
Avience is targeting a minimum of 60% revenue growth in FY27, with the potential to exceed ₹100 crore in revenue, and an aspiration of ₹160-165 crore by FY28. The company is also focusing on expanding its export business, targeting approximately ₹5-7 crore in exports during the year, building on ₹70-80 lakh achieved in the first three months. The new facility is being designed with WHO prequalification in mind to strengthen export capabilities.