Zydus Lifesci.

Zydus Lifesciences reported robust financial results for Q3 FY26, with consolidated revenues reaching ₹68.6 billion, marking a 30% year-on-year increase. This growth was broad-based, with all key businesses contributing significantly. EBITDA for the quarter stood at ₹18.2 billion, up 31% YoY, leading to a strong operating profitability with an EBITDA margin of 26.5%, a 20 basis point improvement over the previous year. Adjusted net profit for the quarter was ₹11.1 billion, up 9% YoY, after accounting for exceptional expense^📎s related to new labor code impact and acquisition costs.

The North America business, encompassing the United States and Canada, generated revenues of ₹28 billion, growing 16% year-on-year. This was primarily driven by sustained volume expansion and new product launches, with 18 ANDAs filed, 8 approvals received, and 4 new products launched during the quarter. A key highlight was the launch of BEIZRAY (albumin-solubilized docetaxel injection), the company's first oncology 505(b)(2) product, and the final USFDA approval for Zycubo (copper histidinate) for Menkes disease, further strengthening the specialty and rare disease portfolio.

Zydus's branded formulation business in India continued its strong growth trajectory, achieving a 14% year-on-year increase and outperforming the market. This growth was fueled by persistent traction in innovation products and pillar brands, with the chronic segment consistently expanding its contribution, reaching 45.3% of the portfolio as per IQVIA MAT December 2025. The company maintained its leadership in Oncology therapy and expanded its presence in diagnostics through a strategic collaboration with Myriad Genetics, introducing three advanced tests.

The International Markets formulation business demonstrated accelerated growth, posting revenues of ₹7.9 billion, up 38% year-on-year, driven by strong demand in both emerging markets and Europe. The Consumer Wellness business also saw significant growth, with revenues of ₹9.6 billion, up 113% YoY, benefiting from the full consolidation of the Comfort Click business. This segment expanded its portfolio with new adult and probiotic gummy variants and Pure Himalayan Shilajit Resin, reinforcing its position in high-growth wellness categories.

Zydus is actively pursuing innovation, with plans to file Saroglitazar Magnesium with the USFDA for PBC indication and regulatory approval received in India to initiate Phase III clinical trials for its second biosimilar ADC. The company also initiated a Phase II trial for Bivalent Typhoid Conjugate vaccine and secured global tenders for rabies and typhoid conjugate vaccines. On the MedTech front, the proprietary Andy robotic surgical system received CE mark approval, confirming its compliance with European standards for safety, performance, and quality.

The company's disciplined M&A strategy, including the acquisitions of Comfort Click and Amplitude Surgical, and licensing of biosimilars (Pembrolizumab and Ranibizumab), has been instrumental in activating new growth engines. Zydus reported a net debt of ₹3,000 crores, primarily due to recent large acquisitions. A shareholder approval for a ₹5,000 crore QIP was secured, intended as an enabling provision for future meaningful acquisitions, as internal accruals and cash flows are currently sufficient for operations without immediate fundraising.

Management guided for R&D spend to be 7.5%-8% of revenue for FY26, acknowledging the lumpiness of R&D expenses. Despite the downward trajectory of Revlimid and potential margin pressure from newly acquired businesses like Comfort Click and Amplitude, the company expects to maintain a "23% plus" EBITDA margin in Q4. Significant product launches are planned for FY27, including 40-45 US generics and 4-5 sizable specialty products, with Saroglitazar commercialization expected in H2 FY27, and a meaningful Bio CDMO business anticipated in the next 2-3 years.