Biocon Limited — Q4 FY25 earnings call

Call held 9 May 2025

Management summary

Biocon reported a robust Q4 FY25 with 15% like-for-like revenue growth, driven by strong performance across Generics, Biosimilars, and Research Services. The quarter saw key product launches and approvals, including Yesintek™ in the U.S. and Liraglutide in the U.K., alongside strategic acquisitions by Syngene. While full-year Generics EBITDA was impacted by pricing pressure and new plant costs, the company is positioned for accelerated growth with new product launches and capacity expansions.

Highlights

  • Group Revenue from operations reached INR 4,417 crores, reflecting a solid 15% year-on-year increase on a like-for-like basis and a 16% sequential growth.

  • Group Core EBITDA for the quarter stood at INR 1,363 crores, a 16% increase from last year with a healthy core operating margin of 31%.

  • Generics business reported Q4 Revenue from Operations of INR 1,048 crores, up 46% year-on-year and 53% sequentially, driven largely by the sale of launch quantities of Lenalidomide.

  • Biosimilars revenue for Q4 was INR 2,463 crores, which is a 9% year-on-year increase on a like-for-like basis, translating into an EBITDA of INR 540 crores, representing a healthy 22% margin.

  • Syngene ended Q4 with Revenue from Operations of INR 1,018 crores, an 11% year-on-year increase, crossing the INR 1,000 crore threshold for the first time with a 35% EBITDA margin.

Concerns

  • FY25 Generics EBITDA was INR 377 crores with a margin of 12%, reflecting pricing pressure and higher operational expenditure linked to new plant capitalizations.

  • FY25 Biosimilars EBITDA, excluding the one-time gain from the BFI business divestment, was INR 1,971 crores with a margin of 22%, which is lower than the reported EBITDA of INR 3,028 crores.

  • Revenues from generic Revlimid are expected to be lumpy before the market opens up in January 2026 for unlimited volume launch by all generic companies.

Key financials

2 periods

Q4

  • Revenue from Operations
    ₹4,417 Cr
    YoY +15% QoQ +16%
  • Core EBITDA
    ₹1,363 Cr
    YoY +16%
  • Core Operating Margin
    31%

FY25

  • Revenue from Operations
    ₹15,262 Cr
    YoY +10%
  • Reported Net Profit
    ₹1,013 Cr

What they filed

Q1 FY27: revenue up 10.0%, net profit up 53.9% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue3,590 3,821 4,417 3,942 4,296 +20%4,173 +9%4,517 +2%4,336 +10%
EBITDA685 752 1,078 766 835 +22%834 +11%1,020 −5%847 +11%
Net profit27 81 459 89 133 +393%-52 −164%199 −57%137 +54%
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

Share of EBITDA (Q4)
₹1,146 Cr Total
  • Biosimilars ₹540 Cr 47.1%
  • Syngene ₹363 Cr 31.7%
  • Generics ₹243 Cr 21.2%

Capital allocation

high confidence
  • Capex Capex disclosed
    • Malaysia capacities for Biologics (drug substance) $100 Mn
    • Generics capex $50 Mn
    • GLP-1 drug substance capacity (capitalized)
    • New injectable facility for GLP-1s (commissioned)
    On the Capex side, like what you said, Surya, we expect to spend about USD 100 million over the next couple of years. After which, it's expected to get moderated down. Large part of this money will go to enhance the capacities in Malaysia, which, for us, is very rewarding given the global demand that we are seeing for the product. For Generics, again, we'll be looking at another USD 50 million next year. And I think with that majority of our ongoing Capex programs come to an end and it will be only small bit of maintenance Capex from FY '27 onwards. So, we have already invested in a large-scale drug substance capacity of GLP-1s, which was capitalized in FY '25. That was one of the reasons that also led to increase in expenses. We have the new injectable facility for GLP-1s, which will be commissioned in FY '26.
  • Debt Net $1.1 Bn
    Net debt is about USD 1.1 billion as on 31st March. And if you normalize for the factoring and advance collections that we have done, it's about USD 1.2 billion. So, I think compared to March '24, March'25 position for net debt, inventory and receivables looks quite healthy. And we'll continue on this improvement here. So thanks, Prapti, for the question. I think what we have announced is that we intend to raise INR 4,500 crores through a combination of QIP and private placement, and we have sent out a shareholders' notice last week towards the same. We have started discussing with our bankers and investors and lawyers about the whole process. We expect to complete the first tranche, which we will decide the quantum of that first tranche in a few weeks. But this first tranche is expected to be complete by middle of June. And proceeds of the fund as you know, Biocon has certain financial obligations towards the commitments and the put options from the structured debt that we had from the investments in Biocon Biologics. So the proceeds of the fund will primarily be used to meet these obligations. No, not in its entirety. I think the investors, of course, have a put option. So for those investors who have exercised their put option, we will look at giving them an exit, but it doesn't mean that all the investors are looking at exercising the put option.
  • M&A Biologics manufacturing facility Acquisition · Closed

    Positioning us to meet the rising demand for biologics CDMO services, this time from a U.S. base. Enhances our capabilities in the global CRDO market and creates our first U.S. manufacturing footprint.

    Syngene's acquisition of a biologics manufacturing facility in the U.S., positioning us to meet the rising demand for biologics CDMO services, this time from a U.S. base. The acquisition of a state-of-the-art biologics facility in the U.S. enhances our capabilities in the global CRDO market and creates our first U.S. manufacturing footprint.

Guidance & targets

Generics

  • Tacrolimus commercialization in China Generics · Q1 FY26 · High confidence Q1 FY26
    We also commenced supplies of Tacrolimus to China, where our partner is expected to initiate commercialization in the first quarter of FY'26.

    — Kiran Mazumdar Shaw

  • Liraglutide Europe launch Generics · Q2 FY26 · High confidence Q2 FY26
    And launch in Europe is planned in the second quarter

    — Siddharth Mittal

  • Liraglutide U.S. target action date Generics · H2 calendar year 2025 · High confidence H2 calendar year
    And as far as U.S. is concerned, as you know, we had mentioned earlier that there were certain queries which we have responded to. The facility of Biocon Biologics, from where the product was filed, has been cleared. Again, we have responded to the FDA. And we have a target action date during the second half of this calendar year.

    — Siddharth Mittal

  • Generic Revlimid unlimited volume launch Generics · Jan 2026 · High confidence Jan '26
    So to that extent, revenues will be lumpy before the market opens up in Jan '26, as you mentioned, when, of course, we will be supplying to various customers, along with other generic companies, who will also be looking at a much larger market share.

    — Siddharth Mittal

  • Capex next year Generics · next year · High confidence USD 50 million
    For Generics, again, we'll be looking at another USD 50 million next year.

    — Siddharth Mittal

Biosimilars

  • Bevacizumab U.S. launch Biosimilars · H1 FY26 · High confidence H1 FY26
    On bBevacizumab, we do have positions with Bev and approval. So, you will be seeing that sometime in the first half year of a launch.

    — Matthew Erick

  • Aspart U.S. approval/launch Biosimilars · H1 FY26 · High confidence H1 FY26
    As you know, with Aspart, we're still waiting on approval, but we are bullish on expectations of having that approval here in the first half and be ready to launch.

    — Matthew Erick

  • Aflibercept Canada launch Biosimilars · July 2025 · High confidence July of this year
    Needless to say, this is a product that we will first be launching in Canada in July of this year, where we will be the first to launch.

    — Shreehas Tambe

  • Aflibercept U.S. market entry Biosimilars · H2 2026 · High confidence no later than H2 2026
    The settlement with Regeneron to secure a market entry date for Yesafili™™, our biosimilar Aflibercept in the U.S., which is expected to be no later than the second half of 2026.

    — Kiran Mazumdar Shaw

  • Denosumab EU approval Biosimilars · next couple of months · High confidence in a couple of months
    We look to get that approval in a couple of months, which is the procedural piece for EMA.

    — Shreehas Tambe

  • Denosumab FDA approval Biosimilars · end of year 2025 · High confidence expected by the end of this year
    FDA approval is also expected by the end of this year.

    — Shreehas Tambe

  • New biosimilars launches Biosimilars · next 12-18 months · High confidence 5
    Shreehas, on the presentation in the press release, we talked about launching 5 new biosimilars over the next 12 to 18 months. If you can just probably spell out which are these names that you have in mind for this calendar?

    — Nitin Agarwal

  • Product launch frequency Biosimilars · FY25 to FY30 · High confidence a product a year
    I mean, apart from the bunching up that has happened in the current time period because of whatever reasons, we've said that from '25 to '30, we saw ourselves launching a product a year, which is what you're seeing us do now.

    — Shreehas Tambe

  • R&D investment % of revenue Biosimilars · full year · High confidence 7-9%
    For the full year, we had given a guidance of 7% to 9%.

    — Shreehas Tambe

  • Capex over next couple of years Biosimilars · next couple of years · High confidence USD 100 million
    On the Capex side, like what you said, Surya, we expect to spend about USD 100 million over the next couple of years.

    — Kedar Upadhye

Capital Raise

  • First tranche completion Capital Raise · mid-June 2025 · High confidence mid-June
    But this first tranche is expected to be complete by middle of June.

    — Siddharth Mittal

Restructuring

  • Update on committee recommendations Restructuring · next few months · High confidence in a few months
    We will evaluate all strategic options and then get back to you in a few months with what the Board recommend

    — Kiran Mazumdar Shaw

What to watch in Q1 FY26

Capital Raise First Tranche Completion

Mid-June
Current In progress, shareholders' notice sent
Target Completion of first tranche

Why it matters

Crucial for meeting financial obligations related to structured debt and strengthening the balance sheet.

We expect to complete the first tranche, which we will decide the quantum of that first tranche in a few weeks. But this first tranche is expected to be complete by middle of June.

Risks & concerns

  • Pricing pressure in Generics business

    medium

    FY25 Generics EBITDA margin of 12% reflected pricing pressure.

    Management acknowledged

  • Higher operational expenditure from new plant capitalizations

    medium

    Impacted FY25 Generics EBITDA due to peptide API facility, Vizag fermentation, and U.S. Cranberry facility.

    Management acknowledged

  • Lumpy revenues for generic Revlimid

    medium

    Revenues will be lumpy until January 2026 when unlimited volume launch is permitted.

    Management acknowledged

  • Market volatility impacting strategic options

    medium

    Market volatility on the IPO front led the Board to evaluate other strategic options, including a merger of BL and BBL.

    Management acknowledged

Q&A highlights

4 direct, 1 evasive
Stelara market share and pricing scenario in the U.S. Direct
We have over 70% market access with the payers in the U.S. at the beginning of the start. With that comes the opportunity for us to continue to pull the product through in the U.S. We are very bullish on our market share. ... The pricing situation remains stable. We're certainly in a good position.

Provides specific details on market access and management's confidence in market share growth and stable pricing for a key biosimilar launch.

Asked by Damayanti Kerai

Launch timelines for Bevacizumab and Aspart in the U.S. Direct
On bBevacizumab, we do have positions with Bev and approval. So, you will be seeing that sometime in the first half year of a launch. As you know, with Aspart, we're still waiting on approval, but we are bullish on expectations of having that approval here in the first half and be ready to launch.

Clarifies the expected launch windows for two important biosimilar products in the U.S. market.

Asked by Damayanti Kerai

Financial position of Biocon Biologics, including debt, working capital, and inventory days. Direct
So Damayanti, our working capital position has substantially improved compared to last year. Our receivables look quite healthy. The number of days across each markets vary, but roughly, they are around 90 days in terms of the credit that we offer to customers. Inventory, in fact, has come down dramatically compared to last year. So, the net inventory as on 31st March is about USD 390 million. In terms of the forward days, it's less than about 280. ... Net debt is about USD 1.1 billion as on 31st March. And if you normalize for the factoring and advance collections that we have done, it's about USD 1.2 billion.

Provides concrete figures on the company's improved working capital management and current net debt levels, addressing investor concerns about financial health.

Asked by Damayanti Kerai

Discrepancy between Biosimilars revenue growth (15%) and core EBITDA growth (10%) for FY25. Partial
Actually, you should adjust for the licensing income that we got last year, Neha. In quarter 3 of last year, if you recollect, we had USD 40 million of profit from sale of brands that was booked as an operating income. So, if you adjust for some of those items, then you'll get an adjusted EBITDA growth which will look quite healthy. ... Core EBITDA reflects, to some extent, the investments that we have to make in the Opex. And yes, there has been some price pressure. But going forward, like what we said, once the new launches do kick in, the incremental gross margin and EBITDA contribution will look quite healthy.

Explains the factors contributing to lower EBITDA growth relative to revenue, including a one-time licensing income in the prior year and Opex investments, while signaling future margin improvement from new launches.

Asked by Neha Manpuria

Lumpiness of generic Revlimid revenues and U.S. launch timeline for Liraglutide. Direct
And as far as the generic Revlimid is concerned, you're right. We had a settlement with the innovator where we were allowed a certain market share, and a large part of that market share has already been serviced in the quarter 4. So to that extent, revenues will be lumpy before the market opens up in Jan '26... And we have a target action date during the second half of this calendar year [for Liraglutide U.S.].

Clarifies the revenue trajectory for generic Revlimid and provides a timeline for the anticipated U.S. launch of Liraglutide, both critical for Generics segment growth.

Asked by Neha Manpuria

Profit-sharing arrangement and exclusivity for Aflibercept in the U.S. market. Evasive
Surya, thanks for your question. We've not specifically disclosed contractual agreements and understandings with our customers. ... I think we are the first biosimilar to have been approved. There is, of course, others who have launched. But we have this position where our product will be approved as an interchangeable on approval, which it was when we got the approval from FDA.

Management declined to provide specific financial details on the Aflibercept deal, indicating commercial sensitivity, but confirmed its first-to-market and interchangeable status.

Asked by Surya Patra

Committee evaluating restructuring, including a possible merger of Biocon Limited and Biocon Biologics Limited. Partial
So let me respond to that by saying that given the market volatility that we are seeing on the IPO front, I think the Board was of the opinion that we should look at other strategic options, which also includes evaluating a merger. So at this point in time, the Board has constituted a committee. We will evaluate all strategic options and then get back to you in a few months with what the Board recommend

Reveals that the company is actively exploring significant structural changes, including a potential merger, driven by market conditions, with an update expected in a few months.

Asked by Nitin Agarwal

3 min read 7 chapters

Detailed narrative

Robust Q4 Performance Across Segments

Biocon delivered a strong Q4 FY25, with overall revenue from operations reaching INR 4,417 crores, marking a 15% year-over-year and 16% sequential growth on a like-for-like basis. This growth was broad-based, with Generics surging 46% YoY, Biosimilars growing 9% YoY, and Research Services (Syngene) expanding 11% YoY. The group's core EBITDA stood at INR 1,363 crores, a 16% increase YoY, achieving a healthy 31% operating margin.

Strategic Product Launches and Approvals

The quarter was marked by significant advancements in Biocon's product portfolio. Key highlights included the global launch of Liraglutide in the U.K. and the introduction of Lenalidomide and Dasatinib in the U.S. Notably, Yesintek™ (biosimilar Ustekinumab) was successfully launched in the U.S., securing over 70% market access with payers and covering over 100 million lives, becoming the fifth product from Biocon's portfolio to enter the U.S. market.

Biosimilars Momentum and Pipeline

Biocon Biologics demonstrated strong commercial momentum, with Fulphila® (Pegfilgrastim) and Ogivri® (Trastuzumab) achieving U.S. market shares of 30% and 26% respectively, a two-fold increase from the previous year. The company secured U.S. FDA approval for Jobevne™ (biosimilar Bevacizumab) and received a positive EU CHMP opinion for biosimilar Denosumab, with U.S. approval expected by year-end. The settlement with Regeneron secured a U.S. market entry for Yesafili™ (biosimilar Aflibercept) no later than H2 2026, with a Canada launch slated for July 2025.

Generics Business Growth and Future Drivers

The Generics business recorded its strongest quarter in FY25, with revenue reaching INR 1,048 crores, driven primarily by the launch quantities of Lenalidomide. While FY25 Generics EBITDA margin was 12% due to pricing pressure and new plant capitalizations, future growth is expected from upcoming launches like Liraglutide in Europe (Q2 FY26) and the U.S. (H2 calendar year), as well as generic Copaxone and Everolimus in the U.S. Tacrolimus supplies to China commenced, with commercialization expected in Q1 FY26.

Capital Allocation and Funding Strategy

Biocon announced plans to raise INR 4,500 crores through a combination of QIP and private placement, with the first tranche expected by mid-June. These proceeds will primarily be used to meet financial obligations related to structured debt for Biocon Biologics. The company's net debt stood at USD 1.1 billion (USD 1.2 billion normalized) as of March 31, 2025, with net inventory at USD 390 million and receivables around 90 days, indicating improved working capital management.

Strategic Review and GLP-1 Investments

In response to market volatility, the Board has constituted a committee to evaluate strategic options, including a possible merger of Biocon Limited and Biocon Biologics Limited, with an update expected in a few months. The company has also made significant investments in GLP-1s, capitalizing a large-scale drug substance capacity in FY25 and commissioning a new injectable facility in FY26, positioning itself to address the substantial market opportunity for drugs like Semaglutide (off-patent 2031) and Tirzepatide (after 2036).

Syngene's Expansion and Performance

Syngene International achieved a milestone, with its Q4 revenue crossing INR 1,000 crores for the first time, reaching INR 1,018 crores, an 11% YoY increase. Its EBITDA for the quarter was INR 363 crores, with a 35% margin. The acquisition of a biologics manufacturing facility in the U.S. further enhances Syngene's capabilities in the global CRDO market and establishes its first U.S. manufacturing footprint.

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