Q2 FY27 results analysis · November 13, 2026
Natco Pharma Ltd (NATCOPHARM) Q2 FY27 Results Analysis: Revenue Falls 29%, Domestic Surges 38%
−60.9%PAT year on year, Rs. 202.60 Cr
Source: Quarterly results filing (BSE)
Quick summary
Natco Pharma Ltd's Q2 FY27 numbers came in mixed, with revenue of Rs. 1,019.40 Cr (-29.00% YoY) and PAT growth of -60.90% YoY. Here's a quick read of what worked, what to watch, and what management said.
Quick Details
| Results date | November 13, 2026 |
|---|---|
| Revenue (Q2) | Rs. 1,019.40 Cr (-29.00% YoY) |
| PAT (Q2) | Rs. 202.60 Cr (-60.90% YoY) |
| EBITDA margin | 30.40% (-1595 bps YoY) |
| EPS (Q2) | Rs. 11.31 (-60.90% YoY) |
Quarter Snapshot
Q2 FY27 revenue of Rs.1,019.4 Cr grew 28.3% QoQ off the Q1 trough but declined 29.0% YoY on the pre-telegraphed Revlimid washout, with EBITDA margin of 30.4% stable sequentially. H1 tracks on plan against reiterated FY27 guidance (53.4% of revenue low-end, 54.6% of PAT target), with base-business growth (Domestic +38.2% YoY, CHS +16.4%, API +13.7%) offsetting the oncology reset. Watch items are the 28.7% ETR versus the ~25% guide, Adcock's Rs.29.2 Cr contribution below the Rs.35-40 Cr band, weak H1 cash conversion (0.40x PAT), and the slipping CHS demerger timeline.
Q2 FY27 Expectations vs Results
| Driver | Expected before results | What happened | Verdict |
|---|---|---|---|
| Headline revenue | "a steep YoY revenue decline in Q2 FY27 is mechanical, not a demand signal" | Total revenue −30.3% YoY, +28.3% QoQ; Domestic +38.2% YoY | Played out |
| Margins | "margins likely compressing modestly on freight/mix… partially offset by FX" | EBITDA margin 30.4% vs 46.4% Q2FY26 — but stable vs 30.9% Q1FY27; the YoY gap is the Revlimid base effect, not fresh sequential compression | Partially |
| Finance-cost drag | "the Rs.13.0 Cr/quarter finance-cost run-rate — not interest — is the margin drag to watch" | Rs.17.6 Cr in Q2, above that run-rate | Partially |
| Adcock normalization | "Q1's Rs.84.3 Cr associate profit was a flu-season quarter management said not to annualize" | Rs.29.2 Cr in Q2 | Played out |
| H1 tracking vs FY27 anchors | "H1 tracking against full-year targets" | 53.4% of revenue low-end; 54.6% of PAT guide | Played out |
| Second interim dividend | "the Nov 13 board meeting will consider a possible second interim dividend" | Rs.1.25/share declared | Played out |
| Parawada 483 classification | "classification is the swing item" | Not addressed in the filing — remains open for the call | Not observable |
| US approvals (Thalidomide first-generic/REMS, Acalabrutinib tentative — per pre-call note, web-sourced) | "approvals inside/around the window support the US launch pipeline" | Not addressed in the filing — remains open for the call | Not observable |
Read our full results preview.
Management Guidance vs Delivery
| What management said | Where | What happened | Verdict |
|---|---|---|---|
| FY27 consolidated revenue Rs.3,400–3,500 Cr | Reiterated at the Q1 FY27 earnings call ("Our guidance still remains around INR750 crores. I am not changing the guidance" — the PAT half of the same reiteration) | H1 Rs.1,813.8 Cr = 53.4% / 51.8% of the low/high ends | On Track |
| FY27 consolidated PAT ~Rs.750 Cr | Reiterated at the Q1 FY27 earnings call | H1 Rs.409.1 Cr = 54.6% of target | On Track |
| Effective tax rate ~25% incl. surcharge (FY27–FY28) | Q1 FY27 call guidance | Q2 ETR 28.7% (H1 31.1%) — watch | Above guide |
| Adcock steady-state Rs.35–40 Cr PAT/quarter to NATCO after amortization | Q3 FY26 / Q1 FY27 calls | Rs.29.2 Cr in Q2, after provisional-PPA adjustment and at the new 49% holding — first quarter at 49% | Slightly below the band |
| H2 revenue needed for the FY guide: Rs.1,586–1,686 Cr (+4.2% vs H2FY26) and H2 PAT needed: Rs.340.9 Cr (−18.7% vs H2FY26's Rs.419.3 Cr) | — derived | Feasibility: On Track — required H2 growth is modest even on a Revlimid-free base | — |
| QoQ revenue improvement on International Formulations | Press release, Q2 FY27 | International Formulations +40.1% QoQ; total revenue +28.3% | Confirmed |
| YoY decline "largely attributable to lower Lenalidomide revenue… partially offset by growth in the base business" | Press release, Q2 FY27 | International −41.4% YoY while Domestic +38.2%, CHS +16.4%, API +13.7% | Confirmed |
| Adcock reduces earnings volatility / normal profit ~Rs.100 Cr quarterly (see-through) | Q1 FY27 call | Q2 associate share Rs.29.2 Cr vs Rs.84.3 Cr Q1 — normalized as management said | Confirmed |
| CHS demerger timeline ("possibly… March instead of December", Q1 FY27 call) | Q1 FY27 call | Note 6: scheme still being revised/refiled; NCLT filing pending — but slipping | Too Early |
Key Investment Insights
Key Positives
- Total revenue grew 28.3% QoQ to Rs.1,019.4 Cr, driven by International Formulations +40.1% QoQ
- Domestic formulations grew 38.2% YoY to Rs.145.7 Cr; Crop Health Sciences +16.4% YoY and API +13.7% YoY
- Agro chemicals segment swung to break-even EBIT margin of 0.2% from −13.0% in Q1FY27 and −12.6% in Q2FY26
- PAT before associate grew 41.9% QoQ to Rs.173.4 Cr from Rs.122.2 Cr
- H1 delivered 53.4% of the low end of FY27 revenue guidance (Rs.3,400-3,500 Cr) and 54.6% of the ~Rs.750 Cr PAT guidance
- Effective tax rate improved to 28.7% from 34.2% in Q1FY27
- Net cash position of Rs.490.6 Cr maintained despite the Rs.1,060 Cr Adcock tranche purchase; second interim dividend of Rs.1.25/share declared
Risk Factors
- Revenue declined 29.0% YoY and EBITDA margin compressed 1,595 bps YoY on the Revlimid washout (International Formulations −41.4% YoY)
- H1 CFO of Rs.165.0 Cr was only 0.40x H1 PAT, with a Rs.97.7 Cr inventory build and Rs.219.9 Cr provisions outflow
- FCF was negative at Rs.(142.5) Cr in H1 on capex of Rs.307.5 Cr plus intangibles
- Q2 ETR of 28.7% is above the ~25% management guide for FY27-FY28
- Adcock associate contribution of Rs.29.2 Cr ran below the Rs.35-40 Cr steady-state quarterly band
- Finance costs rose to Rs.17.6 Cr from Rs.13.0 Cr in Q1FY27 on Adcock acquisition borrowings
Ask about this
Ask Cofacto a question about this result. Answers cite filings and company data.
Companies on this page
Related
Disclaimer: This results analysis is published for educational and informational purposes only. It is not investment advice, not a recommendation to buy, sell or hold any security.