Aarti Drugs reported its audited Q4 and FY26 financial results, showing resilient growth in revenue and a strong sequential recovery in profitability even as margins came under pressure from startup costs and input volatility.

 

The Mumbai-based diversified pharmaceutical player, which operates across Active Pharmaceutical Ingredients (API), formulations, specialty chemicals and intermediates, posted consolidated revenue of Rs. 721.1 crore in Q4 FY26, up 6% YoY and 20% QoQ. For FY26, revenue rose 7% YoY to Rs. 2,567.7 crore.

 

EBITDA in Q4 stood at Rs. 96.6 crore, broadly flat year-on-year but surging 72% sequentially, with margins at 13.4%, down 60 bps YoY. FY26 EBITDA came in at Rs. 311.6 crore, up 3% YoY with a margin of 12.1%.

 

Profit after tax (PAT) for Q4 was Rs. 55.3 crore, down 12% YoY but up 36% QoQ, with margins at 7.7%. FY26 PAT rose 16% YoY to Rs. 194.9 crore.

 

Growth was uneven across segments. API revenue held largely flat at Rs. 551.0 crore in Q4, but formulation sales surged 42% YoY to Rs. 92.0 crore. Specialty chemicals also jumped 46% YoY to Rs. 56.8 crore, while intermediates grew modestly 3% to Rs. 20.5 crore.

 

For FY26, formulations expanded 33% YoY and specialty chemicals rose 37%, underscoring diversification beyond the core API business.

 

Standalone revenue stood at Rs. 631.7 crore in Q4, contributing 88% of consolidated turnover. Domestic business grew 7% YoY, while exports declined 7% YoY in the quarter. However, management highlighted a structural shift toward higher-quality markets, with regulated market contribution rising from 66% in FY25 to 73% in FY26, and export contribution increasing to 38%.

 

Within APIs, anti-biotic products remained the largest contributor at 37.8%, followed by anti-protozoal at 19.6%, anti-diabetic at 15.0%, anti-inflammatory at 11.9%, antifungal at 10.0%, and others at 5.7%.

 

Commenting on the results, Adhish Patil, CFO & COO, Aarti Drugs Limited said, "FY26 marked an important transition year for Aarti Drugs Limited, as the Company progressed through a major investment and commissioning cycle while navigating a challenging industry environment. 

 

"Despite persistent macroeconomic headwinds, pricing pressure in select API segments, and elevated raw material volatility, our core business delivered a strong sequential recovery during Q4 FY26 supported by operational scale-up of the Sayakha facility, improving export traction and a better product mix.”

 

He added, 'Total revenue for Q4FY26 stood at Rs. 721.1 crore, reflecting growth of 6% YoY. EBITDA remained flat YoY to Rs. 96.6 crore, with margin at 13.4%, a decline of 60 bps. The year’s profitability remained impacted by two key factors — start-up losses associated with the new facilities, and continued weakness in the domestic antibiotics market.”

 

Highlighting operational progress, he noted the ramp-up at the Sayakha facility, which reached a milestone run-rate of ~1,000 tonnes per month in March 2026, while acknowledging temporary ammonia shortages that slowed the scale-up.

 

On a sequential basis, he emphasized the turnaround: revenue rose 20% QoQ and EBITDA jumped 72%, with margin expansion of 410 bps, driven by improved execution and product mix.

 

He also pointed to structural improvements in the business mix, with rising contribution from regulated markets and exports, alongside strong growth in formulations and specialty chemicals.

 

Despite continued pressure in API realizations earlier in FY26 and rising input costs driven by supply chain disruptions and geopolitical tensions in West Asia, the company ended the year on a stronger operational footing, with stabilization trends emerging in the second half.