Syngene International reported a subdued March quarter, with profit impacted by one-off items and continued client-specific headwinds, even as management signalled improving underlying momentum and a strengthening pipeline.
The company posted a 16 per cent year-on-year (y-o-y) decline in profit after tax (before exceptional items) to ₹153 crore for Q4FY26, while revenue rose a modest 2 per cent y-o-y to ₹1,037 crore. The decline was largely attributed to exceptional costs, including employee-related expenses, and the ongoing impact of destocking by a key biologics client linked to Librela.
Managing Director and CEO Peter Bains in a post-result investor call, emphasised that the core business remains resilient despite near-term pressures. “While the overall numbers reflect the continuing impact from a single large molecule biologics client, our underlying business continued to show steady momentum,” he said. Sequentially, revenue grew 13 per cent in Q4, indicating early signs of recovery.
Margins under stress
However, margins remained under pressure, with EBITDA margin at 29 per cent compared to 34 per cent a year ago, impacted by higher operating costs and investments in new facilities.
Looking ahead, Syngene is positioning itself for long-term growth through investments in biologics and contract development and manufacturing (CDMO).
The company highlighted increasing traction in its pipeline, particularly in biologics, with rising engagement from global pharma and biotech clients. This spans multiple stages, from early research to commercial manufacturing, reflecting the long-cycle nature of the CDMO business.
Scaling up
The company is also scaling up its capabilities in emerging modalities such as antibody-drug conjugates (ADCs), peptides, and oligonucleotides. During the quarter, it commissioned a new ADC discovery lab and expanded its Bengaluru biologics facility with integrated manufacturing capabilities.
Its Bayview facility in the US is also nearing operationalisation, with active customer discussions underway.
Management indicated that FY27 will be a transition year, with performance expected to remain broadly flat due to lingering client headwinds and facility ramp-up costs. Growth is likely to be weighted towards the second half of the year as new contracts begin to contribute.
Syngene expects its investments in technology, manufacturing, and differentiated capabilities to translate into stronger growth from FY28 onwards, supported by a healthy deal pipeline and increasing demand for integrated outsourcing solutions.