Cipla Ltd — Q3 FY26
Cipla's Q3 FY26 revenue was flat YoY at INR 7,074 crore, with EBITDA margin of 17.7% (down ~150-200bps vs internal expectations) due to lower generic revenues and elevated R&D s...
bearish
high
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Claim Ledger
Did management answer the analysts?
Every material analyst question, graded on whether management actually answered it — with the verbatim exchange and quantitative claims checked against filed numbers.
42%Questions answered6Evaded / deflected12Questions audited
Answered
High priority
What caused Q3 gross margin decline besides Lenalidomide?
Asked by Tushar Manudhane, Motilal Oswal Financial Services
CFO directly attributed the margin decline to Lenalidomide and R&D API purchases, no evasion.
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Question
So firstly, on the Q3 gross profit margin, even if the Lenalidomide related impact is there, is there further anything in the raw material maybe related to lanreotide, which is dragging the gross profit much lower compared to earlier quarters outside Lenalidomide impact?
Ashish Adukia, CFO
So Lenalidomide is a significant impact sitting out there in the gross margin that you see. I think apart from that, in case of R&D, this quarter was a quarter where we purchased certain R&Ds and APIs as well for our R&D expenditure. That led to a significant explanation for the difference that you see out there.
Partial answer
High priority
How much of the $66M US decline is Lenalidomide vs lanreotide?
Asked by Kunal Dhamesha, Macquarie
CFO gave directional but no precise split, withheld exact figures.
no specific numbers given
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Question
So of the $66 million of decline in the U.S. sales on a sequential basis, how much directionally we can attribute to Lenalidomide versus lanreotide?
Ashish Adukia, CFO
So a significant portion of that comes from Lenalidomide, major portion of that. And there is a portion that comes on account of lanreotide as well. But important to note is that, as against what we had planned in lanreotide, it is lower than that we have achieved because of this shortage.
Evasive
High priority
Is US ex-Revlimid run rate back to $125-130M?
Asked by Kunal Dhamesha, Macquarie
CFO declined to validate the run rate estimate, citing inability to share Lenalidomide numbers.
no number givenrefused to confirm
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Question
Then if I remove just both, Lenalidomide, because there's still some residual revenue-based there, and lanreotide is also there, is it fair to say that we are at more like a pre-revenue-based era where we were doing more like $125 million-$130 million quarterly run rate for U.S.?
Ashish Adukia, CFO
So that your assessment is not entirely correct in our lagging at the base because we can't share the numbers of Lenalidomide, unfortunately. It's so difficult for us to explain the entire gap.
Evasive
High priority
Details on three respiratory assets beyond Advair?
Asked by Kunal Dhamesha, Macquarie
CFO described opportunities as 'large' but gave no specifics on market size or competition.
no market size givenrefused to name products
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Question
Would you provide more details on the one we know which is generic Advair, but beyond that, the three respiratory assets, if you could provide some colors in terms of what is the total addressable market, how is the competitive landscape there?
Ashish Adukia, CFO
Yeah. So we have mentioned four respiratory assets. One of them is generic Advair. There are two other fairly large material opportunities where we believe we have a full generic opportunity, which would stay like that for a certain period of time.
Answered
High priority
Is peptide monetization linked to Pharmathen facility?
Asked by Neha Manpuria, Bank of America
CFO gave a clear, direct answer with no hedging.
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Question
My first question is on the peptide monetization that we have talked about in 2027. None of these are from the partner facility that's been impacted, right? Would that be a fair assumption, or some of this is linked to Pharmathen facility getting cleared?
Ashish Adukia, CFO
No, none of them is coming from Pharmathen.
Partial answer
Medium priority
Quantify R&D API impact on gross margin and normalize?
Asked by Neha Manpuria, Bank of America
CFO explained the nature but did not provide a specific dollar or percentage impact.
no specific quantification
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Question
And second, on the gross margin impact that you said, at least from the API for R&D, could you quantify how much would that be, and should we assume that that was just restricted to this quarter and should normalize from next quarter onwards?
Ashish Adukia, CFO
Yeah. So without necessarily giving the risk, if you set that your R&D expenses is about 7% of revenue, part of that 7% sits as material that you purchase, procure as well, which is both R&D and API, and we did that for certain molecules, including oligonucleotides. So what happens is that it is not a quarter regular consistent quarter phenomenon. In this quarter, we purchased, so therefore it can be lumpy as well. So you may not have it coming back in quarter four.
Declined
High priority
How to defend 21% margin into 2027 with Revlimid gone?
Asked by Neha Manpuria, Bank of America
CFO explicitly declined to provide 2027 margin guidance, deferring to next quarter.
deferred to next quarter
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Question
And how should we think about defending the 21% margin that we have guided to this year into next year when Revlimid fully goes away? Initially, we have the lanreotide disruption, but then we also have the launch pipeline. If you could just give us some sense on how we should look at margins for 2027?
Ashish Adukia, CFO
2027 margin, we are not currently guiding towards for a reason that we've not completed our annual operating plan for the year, which needs to go to the board, and then we can give that guidance next quarter.
Evasive
High priority
Comfort and visibility on FY27 US launches?
Asked by Damayanti Kerai, HSBC
CFO expressed confidence but did not provide specific FDA dates or milestones.
no tag dates givenno specific milestones
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Question
So first, on your expected launch for FY 2027 in the U.S., so you mentioned four peptides and four respiratory assets. So just want to understand what kind of comfort and visibility you have on these assets, whether you have got tag dates from the FDA on basis of which you are confident that you should be able to launch these products.
Ashish Adukia, CFO
Yeah. So thank you for that question. The respiratory assets that we have are progressing well through their assessments, and we've been preparing for the launch as well in terms of operation-related activities that need to happen to prepare for the launch. So we are quite confident about those upcoming launches.
Evasive
High priority
Is margin directionally below 20% next year?
Asked by Surya Patra, PhillipCapital
CFO did not confirm or deny the below-20% margin estimate, instead discussing pipeline offsets.
no confirmation of below 20%reframed to pipeline
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Question
And the spend from the R&D side that is likely to continue. So in that case, the overall margin, if we see, it looks like below 20%. Am I thinking whether directionally I'm thinking right, or how should one think?
Ashish Adukia, CFO
So Surya, let me just try and give you some color. So the Lenalidomide is a planned tapering phase which was known for quite some time. So that's happening as we speak. And in preparation for that, we've been working on the pipeline. And as we already mentioned, that pipeline is now looking closer.
Answered
High priority
Is US revenue guidance of $1B by FY27 being revised?
Asked by Abdulkader Puranwala, ICICI Securities
CFO directly confirmed guidance will be revised downward due to lanreotide.
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Question
So my first question is pertaining to your earlier guidance on U.S. revenues where we saw U.S. revenues starting around close to $1 billion by FY 2027. So I mean, post-lanreotide, are we revising that guidance?
Ashish Adukia, CFO
Yeah. I think we'll have to revise the guidance. Yeah. The guidance will have to be revised because if we don't have lanreotide in one quarter, the numbers will be lower, right?
Answered
Medium priority
Is the R&D increase quantum around INR 150 crore?
Asked by Chirag Dagli, DSP Asset Managers
CFO confirmed the INR 150 crore estimate as correct.
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Question
Ashish, on your comment of the increase in R&D, some bit of that being led by the R&D purchases that you've done, the absolute quantum seems like INR 150-odd crore. Is this in the ballpark, or is this way off in terms of if you were to estimate?
Ashish Adukia, CFO
Yeah. See, that's the guidance Chirag had given in the last quarter as well, where we said that our R&D expenses and estimate have gone up by about 50 basis points. Your 50 basis points would translate to somewhere around INR 150 crore. From that sense, yes, your number is very major.
Evasive
Medium priority
Will Cipla launch semaglutide in March?
Asked by Shrikant Akolkar, Nuvama
CFO did not confirm a March launch for semaglutide, instead focusing on tirzepatide.
no commitment on timelinedeferred decision
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Question
My question. I have two questions. Firstly, since we have launched tirzepatide, can you say that we still will be able to launch semaglutide in March, in the month of March?
Ashish Adukia, CFO
So at the moment, we are focusing on tirzepatide. That's a fairly large opportunity with our European partnership with Lenalidomide. As you see from IQVIA data last month, the molecule was dropping upwards of INR 130 crore a month. So our efforts are primarily focused on that. On Sema, we will wait and watch as to how the market evolves.