Solara Active Pharma Sciences Q2 FY27 Earnings Call Transcript Released
Solara Active Pharma Sciences reported its best quarter in five years for Q2 FY27. Revenue rose 33% YoY to ₹418 crore, EBITDA surged 118% to ₹77 crore, and PAT was ₹28.5 crore. Base business revenue grew 37% to ₹327 crore. The Ibuprofen business showed improved performance, nearing breakeven. A strategic review of the Ibuprofen business is expected to conclude in 12 weeks.
The strong financial results, improvement in key profitability metrics, positive outlook for the base business, and progress on strategic reviews (like Ibuprofen) are material events that are likely to significantly influence investor perception and the company's stock performance.
The company reported its best quarter in five years with significant year-on-year growth in revenue, EBITDA, and PAT. Key business segments showed strong performance, and operational highlights like successful audits and ESG rating upgrades indicate positive momentum.
Solara Active Pharma Sciences Limited has released the transcript of its earnings conference call for the quarter ended September 30, 2026. The call, conducted on October 16, 2026, featured insights from Managing Director and CEO Sandeep Rao and CFO Sarat Kumar.
Sandeep Rao highlighted that Q2 FY27 was the company's best quarter in approximately five years, showing significant improvements across profitability metrics including gross margin, EBITDA, and PAT. Overall revenue grew by 33% year-on-year to ₹418 crore, with EBITDA more than doubling to ₹77 crore (up 118%) and PAT reaching ₹28.5 crore against a loss of ₹10 crore in the same quarter last year. The base business revenue grew by 37% year-on-year to ₹327 crore, with EBITDA up 68% to ₹77 crore, achieving a margin of 23.6%. The Ibuprofen business revenue grew 21% year-on-year to ₹91 crore, with its EBITDA loss narrowing significantly, nearing breakeven.
Key operational highlights included the filing of the second Drug Master File (DMF) for the year, with plans to file three more by the financial year-end. The Mangalore facility successfully completed an ANVISA audit in August, following a similar successful audit of the Cuddalore facility in May. CRISIL upgraded the company's ESG rating from adequate to strong.
The strategic review of the Ibuprofen business is ongoing, with an estimated closure in 12 weeks. The company is exploring options such as repurposing the plant into a multiproduct facility or finding a suitable buyer. The sale of unutilized equipment at the Vizag facility resulted in an exceptional loss of ₹45 million.
Financially, gross margin for Q2 FY27 was ₹197 crore (47.2% of gross margin), with the base business achieving over 50% gross margin and Ibuprofen margins recovering to 36%. Operating costs were managed at approximately ₹120 crore, leading to an overall EBITDA margin expansion to 18.4%. Net finance cost decreased by ₹32 million due to a debt reduction of ₹114 crore in H1 FY27. Net debt was reduced to approximately ₹500 crore from ₹614 crore as of March 2026. The Net Debt to EBITDA ratio improved to 1.8x from 3.2x last year.
The company plans to continue focusing on operating cost leverage, margin expansion, and working capital discipline, while funding growth capex and maintaining a strong balance sheet. The management expressed confidence in the base business growth and ongoing DMF filings, aiming for five DMF filings in the current financial year.
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