Revenue surged, but tax and non-operating drag cut Cohance profit
Standalone revenue rose 71.90% YoY, while a 38.77% tax rate and negative other income left net profit 22.06% lower.
Filed 27 Jul 2026, 19:19 IST · after market close · Cohance Lifesciences Ltd (COHANCE)
Key takeaways
- Standalone revenue rose +71.90% YoY, but net profit fell -22.06% as the tax rate increased 17.50 percentage points.
- Operating margin narrowed 0.80 percentage points QoQ to 20.54% because expenses grew +19.05% against revenue growth of +17.85%.
- Other income reduced pre-tax profit by 30.65%, while depreciation rose +147.93% and interest increased +124.78% YoY.
Price around the results
Revenue growth did not reach net profit
Standalone revenue grew +71.90% YoY to Rs 567.55 cr, broadly tracking expense growth of +71.48%, which lifted operating profit by +73.52%. The benefit was absorbed below operating profit: depreciation rose +147.93%, interest increased +124.78%, and other income turned negative at Rs -17.30 cr from Rs 6.63 cr a year earlier. As a result, profit before tax was almost unchanged at +0.21% YoY, while the higher tax rate reduced net profit by -22.06%.
Margin fell for a second straight quarter
Operating margin narrowed 0.80 percentage points QoQ as costs grew faster than revenue, despite revenue increasing +17.85%. This extended the decline from the Q2FY26 peak of 26.29% through 21.34% in Q3FY26 to 20.54% in Q4FY26. The margin was also 2.84 percentage points below the 23.38% median for 48 reported Healthcare peers. The tax rate rose 11.05 percentage points QoQ to 38.77%, adding to the pressure on profit after tax.
Management describes FY26 as a transition year
Management said FY26 was affected by portfolio-mix changes, customer inventory normalisation, regulatory disruptions and timing shifts, while Small Molecules was also affected by delayed Phase III pipeline reloads. For FY27, management said growth is expected to return in the second half, with Q1 likely to be the low point for revenue and EBITDA. The company said second-half EBITDA improvement is expected to come from volume recovery, customer conversions, reloads, product mix and utilisation; it also said four Phase III molecules are expected to enter commercial supply over the next 12–18 months. Management also reported FY26 capex of INR 2.15 billion and said it plans to expand capacity and improve customer assets.
Recent result reactions have usually been negative
In the stock's recent result reactions, five of the last eight moves were down and the median absolute move was 4.69%. The latest recorded reaction was a -5.85% day-one return, with a -7.50% opening gap and a -13.31% move after five sessions. That day-one decline was larger than the stock's typical result-day move.
Q4FY26 at a glance
Standalone figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹568 cr | ₹482 cr | +17.85% | +71.90% |
| Other income | ₹-17 cr | ₹1 cr | — | — |
| Expenses | ₹451 cr | ₹379 cr | +19.05% | +71.48% |
| Operating profit | ₹117 cr | ₹103 cr | +13.42% | +73.52% |
| Operating margin (%) | 20.54% | 21.34% | — | — |
| Interest | ₹5 cr | ₹5 cr | -1.52% | +124.78% |
| Depreciation | ₹38 cr | ₹33 cr | +12.89% | +147.93% |
| Profit before tax | ₹56 cr | ₹65 cr | -13.74% | +0.21% |
| Tax | ₹22 cr | ₹18 cr | +20.62% | +82.64% |
| Net profit | ₹35 cr | ₹47 cr | -26.92% | -22.06% |
| EPS (₹) | ₹0.90 | ₹1.24 | -27.42% | -48.28% |
Operating margin of 20.54% compares with a Healthcare sector median of 23.38% across 48 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -5.85% | -5.99% |
| Next session | -8.14% | — |
| 5 sessions | -13.31% | -14.50% |
| 15 sessions | -12.25% | — |
| 30 sessions | -5.49% | — |
Volume on the results session was 0.74× its 20-day average.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
Guidance & outlook
- FY27 is expected to be a year of growth after Q4 performance aligned with guidance.
- FY27 growth is expected from the second half, with Q1 likely to be the low point for revenue and EBITDA.
- EBITDA improvement is expected in the second half of FY27, driven by volume recovery, customer conversions, reloads, product mix and utilisation.
- Four Phase III molecules are expected to enter commercial supply over the next 12–18 months.
- FY27 is expected to provide better visibility and a more predictable contribution.
Expansion
- FY26 capex was INR 2.15 billion.
- The company plans to expand capacities and improve assets for customers.
New initiatives
- The company entered an AJICAP technology collaboration with Ajinomoto to strengthen site-specific conjugation capabilities.
- The company completed five GMP bioconjugation batches and delivered an end-to-end ADC drug product for a Phase I programme.
Problems & risks
- FY26 was affected by portfolio mix changes, customer-led inventory normalisation, regulatory disruptions and timing shifts.
- Q1 FY27 is expected to be affected by shipment phasing, Middle East-led logistics and input-cost escalation, and higher operating costs.
- Small Molecules performance was affected by customer inventory adjustments and delays in Phase III pipeline reloads.
What to watch
- Whether operating margin recovers from 20.54% after two consecutive quarterly declines.
- Whether the tax rate moves down from 38.77% and reduces the gap between operating profit and net profit.
- Whether the four Phase III molecules management cited enter commercial supply within the stated 12–18 month period.