Aarti Drugs Q4 PAT Rises 36% QoQ to INR55.3 Crores
Aarti Drugs reported a 6% YoY increase in Q4 FY26 revenue to INR721.1 crores, driven by a 41% YoY rise in formulation revenue. While PAT declined 12% YoY to INR55.3 crores, it improved 36% sequentially. EBITDA for the quarter stood at INR96.6 crores with a 13.4% margin. The company is ramping up its methylamines plant, targeting 70% utilization within a year. For FY27, management projects EBITDA margins between 13.5% and 14% and has outlined a capex plan of INR300-400 crores over the next few years.
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Aarti Drugs Limited has reported its financial results for the quarter and year ended March 31, 2026. The company posted a revenue of INR721.1 crores for Q4 FY26, reflecting a growth of 6% year-on-year and 20% quarter-on-quarter. EBITDA stood at INR96.6 crores, an increase of 72% quarter-on-quarter, with a margin of 13.4%. Profit after tax (PAT) for the quarter was INR55.3 crores, a decline of 12% year-on-year but an increase of 36% quarter-on-quarter.
Financial Performance
The standalone business contributed 88% to the consolidated revenue, recording INR631.7 crores. Domestic revenue grew by 7% year-on-year, while export revenue declined by 7% year-on-year. The formulation segment showed strong performance, with revenue rising 41% year-on-year to INR91.3 crores. For the full fiscal year FY26, formulation revenue reached INR330.5 crores, up 16% from the previous year.
| Metric | Q4 FY26 | Q4 FY25 | Q3 FY26 |
|---|---|---|---|
| Revenue (INR Crores) | 721.1 | 678.6 | 602.9 |
| EBITDA (INR Crores) | 96.6 | 95.2 | 56.3 |
| PAT (INR Crores) | 55.3 | 62.8 | 40.5 |
Operational Highlights
The company noted that FY26 was a transition year marked by the scale-up of new manufacturing facilities. The backward integration plant for methylamines at Sayakha achieved a production rate of nearly 1,000 tonnes per month in March 2026. Management expects utilization to cross 55-60% in the June quarter and reach upwards of 70% within a year. The facility is expected to reduce dependence on external inputs and improve margins for the metformin portfolio.
Outlook
Looking ahead to FY27, the company targets EBITDA margins between 13.5% and 14%, contingent on geopolitical factors and crude oil prices. The management indicated a capex plan of INR300 crores to INR400 crores over the next two to three years, focusing on brownfield expansions and formulation capacity. The company has filed a DMF for metformin with the US FDA and plans to invite inspectors for its dedicated facility.
Historical Stock Returns for Aarti Drugs
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| -0.94% | -4.11% | -0.39% | -8.73% | -19.21% | -50.55% |
How might Aarti Drugs' US FDA DMF filing for metformin translate into export revenue recovery, and what timeline could investors expect for meaningful US market contributions?
Given the 7% year-on-year decline in export revenue, which geographies or product segments pose the greatest risk to Aarti Drugs' ability to achieve its FY27 EBITDA margin targets of 13.5-14%?
As the methylamines backward integration plant scales toward 70% utilization, how significantly could the resulting cost savings reshape Aarti Drugs' competitive positioning against Chinese API manufacturers?
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