Mankind Pharma Ltd. Quarterly Results Q3FY26 stock analysis

Home » Core Investor Group » Mankind Pharma Ltd. Q3FY26 Result Update

Sector Outlook: Neutral

Domestic strength and specialty focus fuel consistent profitability

The company posted a revenue increase of 11.5% YoY / down 3.5% QoQ to Rs. 35,672 mn, above our expectations of Rs. 35,060 mn. Improvements in domestic pharma and BSV consolidation primarily drove revenue growth for the quarter. Mankind’s chronic portfolio share improved by 200 bps YoY to 39.3%, supported by robust growth in cardiac (+16.7%) and anti-diabetes (+14.4%) therapies, while the OTC segment rebounded with 5.2% growth in Q3FY26 versus a 2.6% decline in Q2FY26; we expect the growth momentum to sustain and further strengthen going ahead. Export revenue grew by 14% YoY in Q3FY26 and a substantial 50.8% YoY for the 9MFY26. Growth was primarily fueled by the healthy performance of the BSV international business. In the US market, Mankind (excluding BSV) has launched 4 new products in 9MFY26, bringing its total US product portfolio to 48. EBITDA increased 12.7% YoY / down 0.2% QoQ to Rs. 9,194 mn, while EBITDA margin stood at 25.8% (up 95bps YoY) in Q3FY26, driven by a shift in product mix towards chronic therapies, strategic consolidation of BSV, and recovery in consumer healthcare, which led to margin expansion. In Q3FY26, PAT stood at Rs. 5,205 mn (up 14.2% YoY / down 1.7% QoQ) in Q3FY26, above our expectations of Rs. 4,950 crores. PAT margin rise 14.6% versus 14.1% in the previous quarter. Management expects a gradual recovery in the acute segment from the coming quarters and anticipates double-digit growth for the OTC business next year.

Valuation and Outlook

Mankind Pharma’s revenue growth is driven by continued traction in the domestic formulations business (which remains ~85% of focus), improving chronic mix, recovery in OTC, and steady double-digit momentum in the BSV portfolio, with corrective actions and organizational changes expected to show increasingly visible benefits over the coming quarters and next few years. While acute therapies remain soft, management is guiding a gradual recovery as field-force productivity and doctor relationships stabilize. Internationally, growth will remain selective and opportunity-led, with emphasis on complex, niche products without compromising EBITDA, implying domestic will continue to anchor profitability. The chronic segment is expected to remain a key growth driver, supported by deeper penetration in cardiology, diabetes, respiratory, and CNS therapies, as well as a robust pipeline of in-licensed complex products. Consumer healthcare, with its strong OTC brands and increasing premiumization, is likely to see accelerated traction through modern trade, e-commerce, and digital-first strategies. The acquisition of BSV adds a high-margin, high-entry-barrier portfolio in fertility, women’s health, and critical care, backed by advanced R&D platforms in biologics and immunotherapies, which strengthens profitability. With a deep doctor engagement model and investments in digitalization to enhance productivity, Mankind is well-positioned to improve margins and cash flows. This integrated growth strategy, supported by substantial brand equity and balance sheet strength, provides high visibility of earnings expansion and positions the company as a long-term compounding opportunity in the Indian healthcare sector. Thus, we expect Mankind Pharma to generate stable revenues over the long term and is trading at a PE of 40.1x/31.7x on FY26e/27e EPS estimates. We value Mankind Pharma at 38x FY27e EPS and have revised the target price to Rs 2,501 (up 20%).

Key concall Highlights

Domestic Business Outlook:

The domestic business continues to exhibit steady recovery and improving execution, with Q3FY26 revenue growing, supported by ~9% organic growth excluding OTC and BSV, indicating strengthening core prescription momentum. Growth remains largely driven by the company’s strategic pivot toward chronic therapies, with the cardiac and anti-diabetic segments recording robust growth, resulting in a 200 bps increase in chronic mix and consistent outperformance versus the IPM.

Acute profile:

While the acute portfolio, particularly anti-infective, remains relatively muted due to industry softness and field-force transitions, management expects a gradual recovery over the coming quarters as workforce stability improves and doctor relationships mature.

International Business Outlook:

The international business delivered steady growth in Q3FY26, supported by contributions from the BSV portfolio and improving global execution. The BSV international and specialty portfolio continued to register double-digit growth, aided by the successful transition of the restructured prescription portfolio and stronger performance across key export markets. The US business is expected to remain lumpy and opportunistic, while ROW filings and commercialization are likely to unfold over the medium term, implying that domestic formulations will continue to anchor overall growth.

India Consumer Healthcare Business:

The India Consumer Healthcare business witnessed a recovery during the quarter, with revenues growing 5.2% YoY in Q3FY26, compared to a decline in the previous quarter, management attributed the improvement to stabilization in secondary sales and corrective distribution measures, with key brands such as Gas-O-Fast, Manforce and Ova News delivering healthy secondary growth, indicating resilient consumer demand.

R&D Pipeline:

R&D investments increased during the quarter in line with the company’s focus on strengthening its specialty and complex product pipeline. R&D expenses reflect stepped-up investments in product development and portfolio expansion. Management indicated that the current spend remains within its guided range of 2.5–3.0% of revenue for the full year, suggesting a structurally higher but calibrated R&D intensity to support niche chronic therapies, biosimilar and differentiated offerings.

BSV Portfolio:

The BSV portfolio continued to be a key growth contributor across both domestic and international markets, delivering double-digit growth during the quarter, supported by improving prescription momentum and benefits from the portfolio restructuring undertaken earlier.

GLP-1:

Management highlighted GLP-1 as a key strategic focus area within the diabetes and specialty pipeline, with development efforts underway to build capabilities in complex peptide-based and injectable therapies.

Capex:

Management indicated a disciplined and calibrated capital expenditure plan, with FY26 capex guided at ~4–5% of revenue, largely directed toward routine maintenance, capacity augmentation and selective investments in manufacturing and product capabilities rather than any large greenfield expansion.