Divi's Lab.

Divi's Laboratories delivered a strong financial performance for the fiscal year 2026, with consolidated total income reaching ₹11,067 crores, representing a 13.95% year-on-year growth from ₹9,712 crores in FY25. Profit before tax increased by 16.19% to ₹3,388 crores, and profit after tax saw a 17.21% rise to ₹2,568 crores compared to the previous year. The company also reported a forex gain of ₹211 crores for the year, significantly higher than the ₹48 crores recorded in FY25.

The company demonstrated improved operational efficiency, with material consumption as a percentage of sales revenue decreasing to 38.8% in FY26 from 39.8% in FY25. Exports remained a significant contributor, accounting for nearly 89% of total sales revenue, with Europe and the United States making up approximately 74% of export revenue. The product mix for FY26 was 45% generics and 55% custom synthesis, reflecting a balanced portfolio, and the company achieved a constant currency growth of 6.82%.

The Nutraceuticals business continued its strong growth trajectory, with revenue for FY26 amounting to ₹946 crores, a 21.13% increase from ₹781 crores in the previous fiscal year. Divi's also made substantial strategic investments, capitalizing assets worth ₹1,544 crores during FY26, including ₹800 crores in the fourth quarter. Capital work in progress stood at ₹2,113 crores as of March 31, 2026, which includes a ₹1,500 crores expansion plan at Kakinada, with ₹600 crores already capitalized.

The company faced significant external challenges^🌐, including disruptions from geopolitical tensions in West Asia, which led to port congestion, extended transit times, and operational uncertainty. These factors, coupled with increased freight rates and rising raw material prices, impacted costs. While management acknowledged these pressures, they emphasized proactive procurement, strong logistics partnerships, and long-term contracts with variability clauses to mitigate the impact and maintain supply reliability.

Divi's is actively advancing its contrast media portfolio, with Iodine-based products already in commercial sales with major pharma innovators. For Gadolinium compounds, the company is in the qualification stage for Phase II/III molecules, awaiting customer regulatory approvals for commercialization. In the peptide segment, Divi's is deepening its capabilities, validating fragments, and aims to become one of the largest global players, supported by its advanced 3,000-liter Solid Phase Peptide Synthesis (SPPS) units.

Management expressed an outlook for double-digit revenue growth in the future, maintaining that margins would remain stable despite the challenging environment. They noted that the timeline for commercialization of new projects, particularly in custom synthesis and GLP-1, is highly dependent on customer regulatory approvals and volume indications, making precise predictions difficult. The company expects a 'constant capex' for FY27 unless new major custom synthesis projects emerge.