OneSource Specialty Pharma shares experienced a sharp decline of 18% to Rs 1,178 per share on Tuesday following the release of disappointing third-quarter results for financial year 2026. The pharmaceutical company's weak performance was attributed to regulatory delays that significantly impacted its operational metrics.

Financial Performance Overview

The company's Q3 FY26 results showed a dramatic reversal in profitability, with OneSource Specialty Pharma reporting a net loss of Rs 47 crore compared to a profit of Rs 67 crore in the corresponding quarter of the previous financial year.

Revenue Decline and Operational Challenges

Revenue from operations declined significantly by 26% year-on-year to Rs 290 crore from Rs 393 crore in the same quarter of the previous financial year. The company attributed this substantial decline to delayed semaglutide approvals in Canada, which disrupted its operational timeline and revenue recognition.

EBITDA performance was particularly concerning, falling 88% to Rs 17 crore from Rs 142 crore in Q3 FY25. The company explained that this decline resulted from lower revenue combined with a largely fixed cost base, highlighting the operational leverage challenges faced during the quarter.

Management Commentary and Outlook

CEO & MD Neeraj Sharma addressed the quarterly performance, stating that the subdued results were anticipated due to delays in customer approvals in Canada. He noted that these delays have prolonged the transition from the MSA to the CSA phase, though he emphasized that underlying demand remains intact with the order book continuing to trend upwards.

Sharma also highlighted positive developments in the biologics segment, mentioning that another global biosimilar player has been onboarded and the pipeline funnel is at a historic high.

Future Guidance Maintained

Despite the challenging quarterly performance, management reaffirmed its FY28 guidance targets:

Stock Performance Context

OneSource Specialty Pharma shares have faced significant headwinds in recent months, declining over 33% in January 2026 and approximately 41% over the last six months. The current quarterly results have added to investor concerns about the company's near-term operational challenges and regulatory approval timelines.

OneSource Specialty Pharma Limited announced its unaudited financial results for the quarter and nine months ended December 31, 2025, showcasing mixed performance amid operational challenges. The pharmaceutical contract development and manufacturing organization (CDMO) reported its Q3 FY26 results following board approval on January 23, 2026.

Consolidated Financial Performance

The company's consolidated operations reflected challenging market conditions during the quarter. Revenue from operations declined to ₹2,903.40 million in Q3 FY26 compared to ₹3,925.63 million in Q3 FY25.

For the nine-month period ended December 31, 2025, consolidated revenue from operations reached ₹9,933.73 million compared to ₹10,189.00 million in the corresponding period of FY25, indicating a decline of 2.51%.

Standalone Results Analysis

On a standalone basis, the company reported revenue from operations of ₹2,902.20 million for Q3 FY26, down from ₹3,367.49 million in Q3 FY25. The standalone net loss widened to ₹621.85 million compared to ₹730.23 million loss in the previous year's quarter.

Exceptional Items and Operational Costs

The company recorded exceptional items totaling ₹70.90 million during Q3 FY26, comprising employee one-time mutual separation settlement of ₹41.47 million and gratuity and compensated absences impact under new labor codes of ₹29.43 million. This compares to exceptional items of ₹1,005.23 million in Q3 FY25, which primarily included business combination and listing-related expenses.

Total consolidated expenses for the quarter amounted to ₹3,808.86 million, with significant components including:

• Employee benefits expenses: ₹641.92 million
• Depreciation and amortization: ₹696.37 million
• Finance costs: ₹382.31 million
• Other expenses: ₹1,144.60 million

Corporate Developments

The company has entered into a Composite Scheme of Arrangement and Amalgamation involving multiple entities including Brooks Steriscience Limited, Steriscience Pte Limited, and Strides Pharma Services Private Limited. The scheme, approved by the Board of Directors on September 26, 2025, is currently awaiting regulatory approvals.

Additionally, on December 22, 2025, the company approved an amalgamation of its wholly-owned subsidiaries Stelis Pte. Ltd. and OneSource Specialty Pte. Ltd. under Singapore's Companies Act. The amalgamation received regulatory approval on January 14, 2026, and became effective from January 1, 2026.

Segment Performance

The company operates primarily in the CDMO segment, which reported revenue of ₹2,903.40 million for Q3 FY26 compared to ₹3,925.63 million in Q3 FY25. The segment recorded a loss before tax of ₹930.11 million during the quarter, compared to a loss of ₹665.02 million in the corresponding previous quarter.