Zydus Lifesciences shares gain as Q4 earnings showcase strong growth in US formulations biz

Zydus Lifesciences shares gain as Q4 earnings reflect strong growth in US formulations business

Zydus Lifesciences shares were trading higher today by over a percent, after the company posted its Q4 results yesterday. The pharmaceutical firm reported a 34% year-on-year increase in net profit at Rs 1,182 crore, supported by strong growth in its US formulations business and steady performance across other segments.

Revenue for the quarter rose 6% to Rs 5,633 crore, indicating consistent demand for the company’s key products.

The company also saw an improvement in its operating margins, with EBITDA margin rising to 26.7 percent from 25.9 percent in the previous year. This margin expansion came despite a one-time loss related to product liability, which the company managed to offset through operational efficiencies and higher sales.

R&D investments accounted for 7.4 percent of the revenue, at Rs 4.8 billion.

Investor sentiment received an additional boost from the company’s announcement of a final dividend of Rs 7 per share. The combination of strong quarterly numbers, margin improvement, and shareholder rewards has contributed to the positive movement in Zydus Lifesciences stock today.

The company's key businesses saw growth on YoY basis, in its India formulation, Wellness and RoW segments, at 11.5%, 17% and 12%, respectively. Brokerages expect the company's vaccine business to pick up in FY26 with some large tender wins from global procurement agencies.

The company has also entered into the medtech space by signing a share purchase agreement to acquire a majority stake in Amplitude Surgical SA, France.

On Wednesday, May 21, pharma stocks were among the top gainers with the index rallying after the US Department of Health and Human Services said it is working to implement an executive order aimed at lowering healthcare costs.

Nifty Pharma index gained 1.7%, rebounding from a 1.3% drop in the previous session. Eighteen of the 20 constituents advanced.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.