Cohance Lifesciences Limited , a technology-led global Contract Development and Manufacturing Organization (CDMO), has reported a 13% year-over-year revenue growth in Q1, driven by strong performance in its specialty chemicals and API segments. The company's growth trajectory remains aligned with its long-term vision of reaching $1 billion in revenue by 2030.

Key Highlights

• Revenue grew 13% year-over-year in Q1
• Pharma CDMO segment posted 1% revenue growth, but adjusted for inventory destocking, delivered over 30% growth
• Niche technology revenue share increased from mid-teens in FY25 to above 20% in Q1
• Secured a lifecycle management supply mandate from a global innovator for a branded product API
• Announced $10 million investment to expand bioconjugation capacity at Princeton facility
• Committed INR 230.00 million for a CGMP oligonucleotide building block facility at Nacharam

Segment Performance

The company's performance was driven by robust growth across its three business segments:

1. Pharma CDMO: Despite reporting 1% year-over-year growth, the segment delivered over 30% growth when adjusted for inventory destocking in commercial products. The niche technology revenue share increased significantly, reflecting the company's focus on high-value modalities.

2. Specialty Chemicals: This segment reported strong growth of 28%, with improving sequential recovery in the AgChem business.

3. API Plus: The segment delivered exceptional performance with 90% growth, backed by deeper business fundamentals and scaling up of the existing product portfolio.

Strategic Developments

Cohance Lifesciences has made several strategic moves to strengthen its position in the global CDMO market:

1. Expansion of Bioconjugation Capacity: The company announced a $10.00 million investment to expand its bioconjugation capacity at the Princeton facility. This expansion will significantly enhance Cohance's ability to supply full Antibody-Drug Conjugates (ADCs) for clinical studies.

2. New Oligonucleotide Facility: A INR 230.00 million investment has been committed for a CGMP oligonucleotide building block facility at Nacharam, expected to be operational by the end of CY25. This facility will strengthen Cohance's capabilities in the growing oligonucleotide market.

3. Formation of External Advisory Board: The company has inducted five industry experts into its newly formed External Advisory Board. This move is expected to provide strategic counsel on innovation, customer-centric growth, and operational excellence.

4. Leadership Changes: Cohance appointed Yann D'Herve as CEO of the CDMO business, bringing over three decades of experience to the role. This strategic move is aligned with the company's global growth agenda.

Future Outlook

Cohance Lifesciences remains confident in its ability to achieve its long-term goals:

• Reaffirmed guidance of reaching $1.00 billion in revenue by 2030
• Expects niche technology revenue share to approach mid-20s by the end of FY26
• Aims to achieve mid-30s EBITDA margins in the medium term

Vivek Sharma, Executive Chairman of Cohance Lifesciences, commented on the quarter's performance: "Q1 has been an important start to the year, not only from an execution standpoint but also in strengthening the foundation we have put in place over the past 12 months. We remain focused on our core identity as a technology-led global CDMO anchored in scientific partnership, speed, and reliability."

As Cohance Lifesciences continues to invest in niche technologies and expand its global footprint, the company appears well-positioned to capitalize on the growing demand for specialized CDMO services in the pharmaceutical and biotechnology sectors.

Cohance Lifesciences Limited (formerly Suven Pharmaceuticals Limited) has announced its financial results for the first quarter, marking its first full quarter as a combined entity following recent mergers and acquisitions.

Revenue Growth and Business Highlights

The company reported a 13% year-on-year increase in revenue, reaching ₹5,493.00 million for Q1. This growth was primarily driven by the company's niche technology offerings, which now account for over 20% of total sales, up from mid-teens in the previous fiscal year. Excluding the impact of inventory destocking in the Pharma CDMO segment, the overall business growth exceeded 25% year-on-year.

Cohance's performance across its business segments showed mixed results:

• Pharma CDMO revenue grew by 1% year-on-year, but adjusting for inventory destocking, the growth was approximately 30%.
• Specialty Chemicals, including AgChem, posted a strong 28% year-on-year growth.
• The API+ segment reported a 19% year-on-year increase, supported by strong order visibility and new product launches.

Profitability and Margins

Gross margins expanded to 73.00% from 68.40% in the same quarter of the previous fiscal year, benefiting from a favorable product mix and contributions from recent acquisitions. However, the adjusted EBITDA margin stood at 23.90%, reflecting ongoing investments in high-value modalities, talent, and the integration of recently acquired companies NJ Bio and Sapala.

The company reported an adjusted profit after tax of ₹629.00 million, with a margin of 11.40%.

Strategic Developments

Cohance Lifesciences is making significant strides in expanding its capabilities:

1. A USD 10.00 million bioconjugation cGMP suite is under construction at NJ Bio's Princeton facility.
2. A ₹230.00 million oligonucleotide building block facility in Hyderabad, with up to 700 kg/year GMP capacity, is on track for operational readiness by the end of calendar year 2025.
3. The company secured a significant early-phase integrated payload-linker synthesis and bioconjugation order from an existing U.S. partner.
4. Development of a new OEB6 high-containment dedicated block for a major U.S.-based innovator's customized payload program has been initiated in India.

Management Commentary

Mr. Vivek Sharma, Executive Chairman of Cohance Lifesciences, commented on the results: "Q1 has been an important start to the year, with progress not just in execution but in strengthening the foundation we have built. Our growing presence in niche modalities like ADCs and oligonucleotides, combined with a deepening global customer base, positions Cohance for accelerated growth."

Organizational Updates

The company has made key appointments to strengthen its leadership:

• Mr. Yann D'Hervé has been appointed as CEO of the CDMO business, bringing nearly three decades of global leadership experience.
• Cohance has established an External Advisory Board (EAB) comprising five distinguished global pharma leaders to guide the company's scale-up and differentiation across high-growth modalities.

Outlook

Cohance Lifesciences remains confident in its long-term vision of achieving USD 1.00 billion (INR 85.00 billion) in revenue by 2030, with mid-30s EBITDA margins. The company's focus on niche technologies and strategic investments in capacity expansion are expected to drive future growth.

As the company continues to integrate its recent acquisitions and expand its capabilities in high-value modalities, investors and industry observers will be watching closely to see how Cohance Lifesciences capitalizes on its strengthened market position in the global CDMO space.