Cohance Lifesciences reports mixed Q2/H1 FY26 results, revenue down 8% YoY in Q2; reaffirms 2030 targets

* Cohance Lifesciences Limited's Board of Directors, at its meeting held on November 12, 2025, approved the unaudited standalone and consolidated financial results for the quarter and half year ended September 30, 2025. * Q2FY26 Financial Performance: * Revenue stood at ₹5,556 million, an 8% decline year-on-year, primarily due to deferred shipments at CDMO and FDF sites, key molecule destocking, and timing of certain project starts. Adjusting for de-stocking, the quarter reported growth of 14% year-on-year. * Gross margins improved to 74.6%, compared to 71.3% in the same quarter last year, driven by business mix and ongoing efficiency improvements. * Adjusted EBITDA for the quarter was ₹1,289 million, with Adjusted EBITDA margins of 23.2%, reflecting lower volumes, upfront investments in employee costs, and certain transition and remediation costs. * 1HFY26 Financial Performance: * Revenue stood at ₹11,049 million, a 1.2% growth year-on-year, low primarily due to deferred shipments and project timing. Adjusting for de-stocking, the half year reported growth of 20% year-on-year. * Gross margins improved to 73.8%, compared to 70% in the same half year last year, driven by business mix and efficiency improvements. * Adjusted EBITDA for the period was ₹2,630 million, with Adjusted EBITDA margins at 23.8%, lower given phasing towards H2 and reflecting lower volumes, upfront investments, and transition/integration costs. * Key Business Highlights of H1FY26: * An innovator partner, to whom Cohance supplies four intermediates for a Phase III drug, secured US FDA approval for this drug. * Successfully executed a large Phase II order for a leading global innovator, with increasing engagement for long-term agreements. * Good traction across both Agrochemicals and Performance/OLED sectors, reflecting gradual macro recovery. * Sturdy business development traction at CPHI Frankfurt 2025, with multiple new leads from Europe and Japan under evaluation. * Large innovators are increasingly focused on supply-chain de-risking, and niche modalities like ADCs and Oligos are gaining prominence. * Near-term growth was affected by pharma destocking in some key molecules and delayed reloads of a few Phase 2-3 molecules. * Slowdown in biotech funding pushed NJ Bio project shipments by 2-3 quarters due to extended CMC timelines from partners. * Outlook: * The company expects 2H performance to be better than 1H, driven by deferred shipments from H1, new commercial project wins, and audit clearances. * Cohance Lifesciences remains on track to achieve its USD 1 billion (₹85 billion) revenue target by 2030, with mid-30s EBITDA margins. * Management Commentary: * Mr. Vivek Sharma, Executive Chairman, stated that Cohance is focused on building science platforms, operational backbone, and governance to power its next phase of growth, supported by a revised organization structure and strengthened leadership team. * He acknowledged near-term challenges such as pharma destocking, biotech funding delays, and a temporary Nacharam plant shutdown, but affirmed strong fundamentals, key regulatory milestones, new biotech partnerships, and healthy demand from large innovators seeking diversified supply chains.