Anthem Bioscienc Q1 FY27 Results (NSE: ANTHEM)
Signal: Margin expansion
The read
Q1FY27 was a sharp revenue reversal (-22.6% YoY, -22.6% QoQ) after a strong Q4FY26 (+26.5% YoY), but operating discipline held — OPM expanded 400bps YoY to 42.0%, driven by mix shift rather than volume, marking a 4th consecutive quarter of YoY margin expansion. PAT fell less than revenue (-11.6% YoY) aided by a lower tax rate. The subsidiary Neoanthem Lifesciences contributed ~₹35.8 Cr standalone revenue and ~₹8.2 Cr profit, underscoring the group's diversification; standalone performance was weaker. EPS dilution from ESOP allotments (1.67 Mn shares) is a minor but notable drag.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹41.82 Cr | -22.6% | -22.6% |
| EBIT | ₹15.57 Cr | -22.4% | |
| Net profit | ₹11.99 Cr | -11.6% | |
| EPS | ₹2.13 | -12.3% | |
| EBIT margin | 42.0% |
P&L walk
Revenue fell sharply -22.6% YoY and QoQ, but OPM expanded 400bps YoY to 42.0% on a favourable mix shift towards higher-margin work and tight cost control, marking the 4th straight quarter of YoY margin expansion.
Segments
CRDMO segment revenue fell -24.7% YoY and -33.5% QoQ to ₹3,408.02 Mn, driving the overall revenue decline; however, its gross profit margin rose to ~68.2% vs ~58.5% in Q1FY26, indicating mix upgrade. Speciality Ingredients revenue declined -11.5% YoY but its gross profit margin improved to ~51.4% vs ~50.8% in Q1FY26.
Key positives
- OPM expanded 400bps YoY to 42.0%, the 4th consecutive quarter of YoY margin expansion, driven by favourable product mix and input cost efficiency.
- Gross profit margin on consolidated segment revenue rose ~770bps YoY to ~65.0%, indicating strong pricing power and mix shift towards value-added services.
- Net debt remains near zero (D/E 0.02), finance cost declined -44.9% YoY, and interest coverage remains extremely comfortable at ~175x.
- Effective tax rate dropped to 20.6% from 27.0% in Q1FY26, boosting PAT margin to 28.7% (+340bps YoY).
Key concerns
- Revenue fell -22.6% YoY and QoQ, a stark reversal after 4 quarters of YoY growth, raising questions about demand visibility and lumpiness in CRDMO operations.
- Standalone performance was weaker: revenue -28.7% YoY, PAT -31.2% YoY — group profit was bolstered by the subsidiary Neoanthem Lifesciences, which may not be sustainable at the same scale.
- EPS growth lagged PAT by 70bps due to ESOP dilution (1.67 Mn shares allotted in Q1).
- Employee cost as a % of revenue rose 150bps YoY, partly offsetting gross margin gains.
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