At a glance:
Granules India’s Q4 FY25 results show a classic pharma plot twist — flat revenue, soaring profit. With ₹11,974 Mn revenue (+2% YoY), ₹1,520 Mn PAT (+17% YoY), and a strong EBITDA margin of 21%, the company has managed to out-formulate the odds despite USFDA woes at Gagillapur. For FY25, net profit rose 24% to ₹5,015 Mn. Is the worst behind? Or are we in Act II of the compliance drama?
🏢 About the Company
Granules India Ltd is a vertically integrated pharmaceutical company based in Hyderabad. They operate across the full pharma spectrum — APIs, PFIs, FDs, and now CDMO for peptides — supplying to 300+ customers in 80+ countries with 11 facilities globally (8 India, 2 USA, 1 Switzerland).
Think of them as the 4-in-1 shampoo of Indian pharma. Except, they don’t clean your hair — they clean your liver, gut, and whatever else is ailing.
👨💼 Key Managerial Personnel (KMP)
- Dr. Krishna Prasad Chigurupati – Chairman & MD (aka The Formulator-in-Chief)
- Chaitanya Tummala – Company Secretary & Compliance Whisperer
📊 Financials Breakdown (INR in Mn)
🔹 Q4 FY25 (YoY Growth)
| Metric | Q4FY25 | Q4FY24 | % Growth |
|---|---|---|---|
| Revenue from Operations | ₹11,974 | ₹11,758 | +2% |
| EBITDA | ₹2,524 | ₹2,557 | -1% |
| PAT | ₹1,520 | ₹1,296 | +17% |
| EBITDA Margin | 21% | 22% | -1%pt |
🔹 FY25 vs FY24 (Full Year)
| Metric | FY25 | FY24 | % Growth |
|---|---|---|---|
| Revenue | ₹44,816 | ₹45,064 | -1% |
| EBITDA | ₹9,452 | ₹8,560 | +10% |
| PAT | ₹5,015 | ₹4,053 | +24% |
| Net Profit Margin | 11% | 9% | +2%pts |
💰 ROCE: 16.6% | 🧾 Net Debt: ₹7,061 Mn | 💪 Net Debt/EBITDA: 0.75x
🧪 Business Segments Snapshot
| Segment | Revenue Contribution (Q4 FY25) |
|---|---|
| Finished Dosages (FD) | 77% |
| APIs | 12% |
| PFIs | 10% |
📈 North America’s contribution hit 79% in Q4, up from 70% last year. Essentially, Uncle Sam is their biggest pharmacy customer.
🏭 What’s Going on at Gagillapur?
- Gagillapur facility faced USFDA heat in 2024.
- Operations paused proactively in Sep-24.
- Remediation underway = productivity slowdown in H2 FY25.
- Still, Formulation business grew 18%.
Let’s just say — when the FDA sends a letter, Indian pharma stops everything… except billing.
💡 Forward-Looking Fair Value (FV)
Assuming a conservative 15x P/E on FY25 PAT, and 8% EPS growth in FY26:
- FY26E PAT: ₹5,416 Mn
- Shares Outstanding: ~24.86 Cr
- EPS FY26E: ₹21.78
- 🧮 Fair Value Estimate: ₹327 per share
📍 CMP: ₹521.20 → Already well above conservative fair value = Market pricing in strong FY26 revival + US market faith.
🧬 Industry Outlook
- CDMO is hot. Granules is scaling peptide capabilities.
- US generic market is brutal — cost controls key.
- API production shifting to India = long-term tailwind.
Granules’ diversified vertical model + regulatory agility could turn them into a cash compounding machine — provided USFDA doesn’t pop up again like a horror sequel.
🎭 EduInvesting Take
Granules India pulled off a solid performance — even with one production arm tied behind its back (thanks to Gagillapur shutdown). They sacrificed growth to fix compliance — and still delivered +24% PAT growth. That’s not pharma, that’s a flex.
🚨 But let’s not sugarcoat the bitter pills:
- Revenue dipped YoY.
- Gagillapur fix isn’t fully done.
- Formulation-led margin growth can reverse if pricing pressure intensifies.
If USFDA doesn’t knock again, this script might just have a blockbuster ending.
🚩 Risks & Red Flags
- USFDA remediation delays
- Overdependence on North America (79% rev)
- Currency volatility + regulatory tightening
- Execution risk in CDMO expansion
📅 Published: May 28, 2025
✍️ By: Prashant Marathe
Tags: Granules India Q4 FY25 results, pharma earnings, USFDA Gagillapur, API PFI formulations, India pharma exports, EduInvesting, EBITDA margin, CDMO growth, Indian pharma stocks
