Zydus Wellness Q1 FY27 Earnings Call: Revenue Surges 67% on Comfort Click, International Business Grows 25% (ZYDUSWELL)

Zydus Wellness Ltd held its Q1 FY27 earnings call on August 04, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Revenue Surges 67% on Comfort Click Consolidation

• Consolidated net sales of Rs.14,299 crores in Q1 FY 2026-2027, up 66.7% YoY, driven primarily by the Comforclik business.
• EBITDA grew 55.3% to Rs.2,417 million in Q1 FY 2026-2027, with core business EBITDA margin expanding 0.4% on a like-to-like basis.
• Net profit declined 7% in Q1 FY 2026-2027, but adjusted for brand amortization, grew 26.5%.
• Organized channel saliency reached 38% in Q1 FY 2026-2027, with modern trade at 17% and digital commerce at 21%.
• Seasonal brands declined 12% in Q1 FY 2026-2027 due to weather impact, with North and East regions being the primary drags, though management expects recovery in the remaining part of FY 2026-2027.

Domestic Portfolio Mixed; International Momentum Strong

• International business (including Comforclik) delivered 24.8% like-to-like growth in Q1 FY 2026-2027, while domestic business grew 4.6%.
• Domestic skin and hair care grew 34.5% and food and nutrition grew 16% in Q1 FY 2026-2027, partially offsetting the seasonal portfolio decline.
• West and South regions showed positive momentum for Glucon-D and Nycil in Q1 FY 2026-2027, while North and East were the primary drags due to continued rains in April and May.
• Complan growth over the past two quarters (including Q1 FY 2026-2027) is attributed to a consistent strategy of segment-focused branding, celebrity ambassador Weber Suryavanshi, and distribution expansion, with core kids nutrition as the primary driver.
• Natural brand (max protein) is growing at more than double its historical growth rate, driven by brand building (e.g., FIFA World Cup), distribution expansion, and portfolio enhancement; momentum is expected to continue.

EPS-Accretive Acquisition; US Entry Still Early-Stage

• Comfort Click became EPS accretive from Q4 FY 2025-2026 and has sustained that status; management expects continued momentum to drive margin expansion and higher EBITDA and PBT in Q2 and Q3 FY 2026-2027.
• Quarterly interest and depreciation costs of ~Rs.80-85 crores are expected to persist even as Comfort Click scales, with seasonal headwinds in the near term.
• The entire Comfort Click portfolio is digital-only and OTC (no doctor prescription required); management does not envisage any structural change to this, even if GLP-1 adoption trends drive demand.
• US entry for Comfort Click is currently very small but growing in line with expectations; management considers it too early to predict whether it will become a meaningful driver over the next two years.
• Management reiterated "double-digit" growth guidance for international business without providing a specific numeric forecast, though the ~25% like-for-like growth in Q1 FY 2026-2027 was noted as sustainable for upcoming quarters.

Right Bite, Complan, and Max Protein Lead New Product Pipeline

• Right Bite acquisition revenue was Rs.120 crores in Q3 FY24 (quarter of acquisition), with growth driven by core products and new SKU launches over the trailing four quarters (Q2 FY25-26 to Q1 FY26-27), including wafer bars, roots (ghee, jaggery, dates), Korean chips, RTDs, and max protein cookies.
• Management outlined a robust launch pipeline with multiple launches over the last 3-4 quarters (Complan, Sugar Free, Max Protein, Glucon-D, Nycil) and a few more planned in the coming quarters, with a focus on scaling up existing NPDs.
• Complan has entered a new RTD format with Complan Power Play and is participating in specialized nutrition spaces including toddler nutrition (Complan NutriGro) and adult nutrition (V-Max, V-Max Diabetes, launched in Q4 FY 2025-2026).
• Management declined to predict revenue mix within the protein portfolio over the next three fiscal years (FY 2027-2028 through FY 2029-2030), noting bars currently dominate but each category (bars, beverages, snacks) has substantial potential.
• EverYuth remains B2C-focused on facial cleansing (scrubs, peel-off, face washes), where the brand continues to gain market share; adjacent skincare categories are being explored in a smaller way with pilots for new propositions (tan removal, anti-pollution).

A&P at 18.2%; Tax Rate Guided at 25% for FY27

• Total A&P spend as a percentage of sales was 18.2% for Q1 FY 2026-2027, including Comfort Click (which has a higher A&P ratio); core business A&P was similar to Q1 FY 2025-2026 on a like-for-like basis.
• Digital spend as a share of overall A&P investments is increasing as consumers shift to digital media, with engagements becoming easier and sharper across platforms.
• Q1 FY 2026-2027 effective tax rate was ~27% due to UK thin-cap disallowance; otherwise would have been 25%.
• For FY 2026-2027, management guided 25% effective tax rate, with 12%–15% cash component; from FY 2027-2028, the entire 25% rate is expected to be cash.
• Interest cost decreased QoQ after transitioning from a GBP loan to a cheaper Euro loan; management expects it to remain around current levels subject to Euro benchmark rate changes.

Seasonal Recovery Expected; International Growth Sustained

• Management expects growth momentum for seasonal brands (Glucon-D, Nycil) to recover in the remaining part of FY 2026-2027, as the second half of Q1 showed a good recovery and inventory levels are low with 3-year shelf life.
• The "right by next moving" portfolio (likely Nutralite) shows strong traction in top line and profitability, with offline expansion into T2, T3 towns progressing well, though selective due to high-value nature.
• Management's long-term strategy focuses on building a premium portfolio through innovation and technology-enabled execution to drive sustainable profitable growth.
• Support team for international expansion (US, Middle East) will continue to be based in India, with no plans to enter B2B professional face cleansing market.
• Management does not provide a specific numeric forecast for international growth beyond "double-digit" guidance, and considers it too early to predict US Comfort Click contribution over the next two years.