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    Viyash Scientific Limited

    VIYASH
    Healthcare·21 Nov 2025
    Management Summary

    Viyash delivered a robust Q2 FY26 performance with significant revenue and EBITDA growth, driven by new product launches and operational efficiencies. The NCLT approval for the merger with SeQuent Scientific is a key milestone, with the combined entity poised for sustained high margins and growth. Strategic focus remains on R&D, manufacturing optimization, and expanding into value-added products and companion animal segments.

    Highlights

    5

    • Viyash reported a strong Q2 FY26 revenue of ₹428 crores, reflecting a 17.8% year-on-year growth.

    • Viyash's EBITDA surged by 96% year-on-year to ₹123 crores, with EBITDA margin improving by 11.5% to 28.8%.

    • The National Company Law Tribunal (NCLT) approved the merger with SeQuent Scientific, marking a new chapter for the combined entity.

    • The combined entity achieved a Q2 FY26 revenue of ₹852 crores, growing 16% year-on-year, and an EBITDA of ₹189 crores with a 22% margin.

    • Management expressed confidence in sustaining Viyash's EBITDA margins above 20% and achieving a 20% CAGR top line growth over the next three years.

    Concerns

    3

    • Regulatory qualifications for transferred intermediates take time, impacting synergy realization timelines.

    • Potential for 'little impact' from competition on certain products, though not seen as a major issue.

    • US tariffs are a general industry concern, though management states no current impact on their business.

    What Changed2

    vs Q3 FY26

    Guidance items9 → 10 (+1)Risks discussed4 → 3 (-1)

    Key financials

    Single quarter

    03 metrics
    1. 01Revenue₹428 Cr+17.8%YoY
    2. 02EBITDA₹123 Cr+96%YoY
    3. 03EBITDA Margin28.8%

    Capital allocation

    3
    high confidence
    CategoryHeadline
    Capex

    ₹60 crores

    internal accruals

    Debt

    Debt disclosed

    Liquidity

    Liquidity disclosed

    Strong balance sheet and free cash flow generation support future growth and potential inorganic opportunities.

    Guidance & targets

    10
    CategoryTargetPriority
    Profitability
    Viyash EBITDA Margin
    20-plus%
    		High
    Profitability
    Viyash EBITDA Margin
    27%
    		High
    Profitability
    Combined Entity EBITDA Margin
    20-plus%
    		High
    Profitability
    Combined Gross Margins
    above 50%
    		High
    Revenue
    Viyash Top Line Growth
    20% CAGR
    		High
    Revenue
    SeQuent API Business Run Rate
    ₹100 crores
    		High
    Revenue
    SeQuent API Business Growth
    substantially
    		Medium
    Debt
    Debt Status
    debt free
    		High
    Capex
    API Capex
    no major capex
    		High
    Capex
    Overall Capex
    ₹100-150 crores
    		Medium

    Viyash Top Line Growth

    Next quarter and subsequent quarters (over 3 years)
    Current17.8% YoY in Q2 FY26
    TargetSustained 20% CAGR

    Why it matters

    Verifies the sustained growth momentum of Viyash post-merger, crucial for the combined entity's overall performance.

    But definitely, 3 years, we can take comfortably 20% CAGR growth top line.

    How to verify

    key_financials.metrics[label='Revenue']

    Risks & concerns

    3
    RiskSeverity

    US Tariffs

    Management states no current impact on their business from US tariffs, and low dependency on the US market for formulations. — Analyst downplayed

    low

    Competition Impact on Products

    Management acknowledges that competition could have a 'little impact' on certain products after launch, but not a major one. — Management acknowledged

    low

    Regulatory Timelines for Development

    Regulatory processes for animal health development and cost optimization take 12 to 18 months, impacting the speed of synergy realization. — Management acknowledged

    medium

    Q&A highlights

    8

    “Yes, we can see Q4 combined number. So, once we receive NCLT final order, I think we can start putting combined number. But I think Q3 itself, we can actually -- Q3, we can do combined.”

    Clarifies when investors can expect to see financial results for the newly merged entity.

    asked by Vishal Manchanda

    2 min read6 chapters

    Detailed Narrative

    01

    Robust Q2 FY26 Performance for Viyash

    Viyash delivered a strong Q2 FY26, reporting a top line of ₹428 crores, which represents a 17.8% year-on-year growth. The company's EBITDA saw a significant increase of 96% year-on-year, reaching ₹123 crores. This impressive performance led to an EBITDA margin of 28.8%, marking an improvement of 11.5% compared to the previous year, driven by new product launches and strategic cost management.

    02

    Merger Approval and Combined Entity Strength

    The National Company Law Tribunal (NCLT) granted approval for the merger of SeQuent Scientific and Viyash Group on November 18, 2025, signaling a new growth phase. The combined entity reported a Q2 FY26 revenue of ₹852 crores, demonstrating a 16% year-on-year growth. The merged operations achieved an EBITDA of ₹189 crores, with a healthy margin of 22%, indicating strong operational leverage and potential for future synergies.

    03

    Strategic Focus on R&D and Product Portfolio Expansion

    Viyash continues to prioritize R&D, having developed over 40 new products, including APIs and finished formulations, in the last 3-4 years, with 8 product launches this year. The company is strategically shifting towards value-added products and away from commoditized intermediates to enhance gross margins. SeQuent's R&D expenditure is currently in the range of ₹8-10 crores, supporting ongoing innovation and pipeline development, particularly in the companion animal segment.

    04

    Manufacturing Optimization and Synergy Realization

    Significant efforts are underway to optimize manufacturing processes, including backward integration into API production and leveraging lower-cost manufacturing bases in India. Viyash has successfully commissioned a new production line to support SeQuent's large-volume products. Management anticipates that R&D synergies, especially from product optimization, will begin to yield benefits within 12 months, contributing to improved gross margins and overall efficiency.

    05

    Capital Allocation and Financial Outlook

    Viyash incurred ₹60 crores in capex during the last quarter, primarily for strategic initiatives. While no major capex is planned for API in the next two years, an estimated ₹100-150 crores capex is projected for FY27-28, potentially spilling into FY28. The company aims to be debt-free by FY27, leveraging its strong balance sheet and consistent free cash flow generation to support future organic and potential inorganic growth opportunities.

    06

    Market Tailwinds and Growth Projections

    The animal health industry benefits from resilient market tailwinds, including increasing demand for animal protein, dairy products, and growing pet adoption. Management is bullish on the formulations business, projecting sustained double-digit growth. The SeQuent API business is expected to maintain a run rate of ₹100 crores and achieve substantial growth from FY27 onwards, capitalizing on market opportunities and strategic initiatives.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.