Syngene International reported a challenging Q3 FY26 with revenue declining 3% year-on-year and PAT dropping significantly, primarily due to the ongoing impact from a single large molecule biologics customer. However, the nine-month performance showed a 3% revenue growth. The company revised its full-year FY26 revenue guidance to a decline of 3-5% but highlighted steady underlying business growth and strategic investments in capabilities and capacity, including extending its key collaboration with Bristol Myers Squibb until 2035.
vs Q4 FY26
| Metric | Value | YoY |
|---|---|---|
| Q3 Revenue from Operations | ₹917 Cr | -3.0% YoY |
| Q3 Operating EBITDA | ₹209 Cr | — |
| Q3 Operating EBITDA Margin | 23% | — |
| Q3 PAT (pre-exceptional) | ₹73 Cr | -44.0% YoY |
| Q3 Reported PAT | ₹15 Cr | -89.0% YoY |
| 9M Revenue from Operations | ₹2.7K Cr | +3.0% YoY |
Segment Breakdown
| Metric | Latest | Trend |
|---|---|---|
| Revenue from Operations(crores) | 875 | |
| Operating EBITDA(crores) | 206 | |
| Operating EBITDA Margin | 34% | |
| Net Cash(crores) | 1053 |
Total Value
USD 500 million
as of 2025-12-31
Execution
10-year program
"The company has a significant long-term contract for a single product, which has faced headwinds due to inventory correction and product-specific issues, impacting current performance."
| Category | Headline | |
|---|---|---|
Capex | USD 9 million this quarter · USD 45 million (FY26) planned | |
Liquidity | Cash ₹902 crores |
| Category | Target | Priority |
|---|---|---|
| Revenue | FY26 Revenue Growth→decline in the range of 3% to 5% | High |
| Profitability | FY26 Operating EBITDA Margin→22% to 23% | High |
| Capex | FY26 CAPEX→$45 million | High |
| Costs | Full Year Raw Material Costs→around 25% | High |
| Tax Rate | Effective Tax Rate→21% to 23% | High |
| Business Performance | Underlying Business Growth (excluding single product)→high single-digits, low double-digits | Medium |
| Single Product Impact | Duration of Single Product Impact→continue in the coming quarters, and then it will play itself out through the coming quarters, but it will go beyond Q4 | High |
| # | Metric | |
|---|---|---|
| 01 | Duration and magnitude of single product impact | |
| 02 | Bayview Biologics facility operationalization | |
| 03 | Acceleration of underlying business growth | |
| 04 | FY27 Guidance |
| Severity | Risk |
|---|---|
high | Ongoing impact from single large molecule biologics product This product's performance is the key variable impacting Q3 results and led to revised FY26 guidance, expected to continue beyond Q4 FY26. Management |
high | Inventory correction and product-specific issues for a key product The specific product (Librela from Zoetis) faced inventory correction and now has public product issues, creating headwinds for Syngene's supply. Management |
medium | Exceptional item due to new labor codes A one-time charge of Rs.58 crores net of tax was incurred due to changes in gratuity liability under new Indian labor codes. Management |
Syngene International reported a challenging third quarter for FY26, with revenue from operations declining 3% year-on-year to Rs.917 crores, and 7% in constant currency. Operating EBITDA for the quarter stood at Rs.209 crores, resulting in a margin of 23%, a decrease from 30% in the previous year. Profit after tax before exceptional item📎s was Rs.73 crores, down 44% year-on-year, while reported PAT was Rs.15 crores, an 89% year-on-year decline. Consequently, the company revised its full-year FY26 revenue guidance to a decline of 3% to 5% and expects an operating EBITDA margin in the range of 22% to 23%.
The primary factor impacting the Q3 performance and the revised full-year guidance is the ongoing effect related to a single commercial-stage product from the company's largest large molecule biologics customer. This impact, which includes inventory correction and product-specific issues, is expected to continue through the coming quarters and beyond Q4 FY26. Management emphasized that this single product's underperformance is the key variable driving the current financial headwinds.
Despite the challenges posed by the single product, Syngene's underlying business performance, excluding this specific product, has shown steady progress. The research services segment, comprising two-thirds of the business, continues to secure new customers and contracts across chemistry, biology, translational, and clinical research platforms. The CDMO business, which accounts for one-third of revenue, is experiencing increased capacity utilization in both small and large molecules. The rest of the business is growing in high single-digits to low double-digits in constant currency terms.
Syngene continues to invest in strengthening its scientific capabilities and manufacturing technologies. In Q3, the company invested approximately $9 million in CAPEX. This included expanding advanced chemistry capabilities at Hyderabad with new catalytic screening and flow chemistry laboratories, and commissioning a new commercial-scale facility for liquid-filled hard gelatin capsules, enhancing its oral solid dosage platform. The Bayview Biologics facility in the US has completed process and equipment validation, with hiring underway to support planned operations.
A significant highlight for the quarter was the extension of the long-standing relationship with Bristol Myers Squibb (BMS). This collaboration, which involves over 700 scientists in Bangalore, has been extended through to 2035. This 10-year extension provides both partners with a strategic horizon to further develop and expand their unique collaboration, underscoring the strength of Syngene's client relationships.
Management noted an improving trend in the biotech funding environment, with venture capital funding showing signs of thawing and accelerating after a prolonged period. This is seen as an encouraging sign for Syngene, given its strong exposure to biotech companies. The company aims to leverage this trend to provide further opportunities for collaboration and support, particularly in its research services business, which is experiencing growth across chemistry, biology, biotherapeutics, and translational and clinical sciences.
For the nine-month period, CAPEX is estimated to be around $45 million. The company maintains a strong balance sheet, with a net cash balance of Rs.902 crores as of December 31, 2025, after meeting its CAPEX spends for the quarter. This financial strength supports ongoing investments in capabilities and capacity expansion.