Q1 loss persists as operating margin drops 8.14 percentage points QoQ
Year-on-year growth improved margins, but a sequential revenue drop and a Rs 61.93 cr tax expense kept the consolidated result in the red.
Filed 29 Jul 2026, 20:44 IST · after market close · Piramal Pharma Ltd (PPLPHARMA)
Key takeaways
- Piramal Pharma reported a consolidated Q1FY27 net loss of Rs 69.39 cr despite Rs 108.97 cr of other income, showing weak profit conversion.
- Operating margin fell 8.14 percentage points sequentially as revenue declined 17.51% while expenses fell only 9.45%.
- Revenue grew 17.39% year on year and operating margin improved 3.08 percentage points, but the 8.6% margin was 20.05 percentage points below the 12-peer Healthcare median.
Price around the results
Sequential margin reset after Q4FY26
On a consolidated basis, revenue fell 17.51% sequentially, while expenses declined 9.45%, so operating margin narrowed from 16.74% to 8.6%, a drop of 8.14 percentage points. Interest increased 6.13% and depreciation rose 2.37%, adding pressure below operating profit. This reversed the margin improvement seen through Q4FY26.
Year-on-year improvement did not reach net profit
Year-on-year revenue growth of 17.39% outpaced expense growth of 13.56%, lifting operating margin by 3.08 percentage points and operating profit by 82.94%. That improvement was not enough to offset interest, depreciation and the reported Rs 61.93 cr tax expense: profit before tax remained negative at Rs 7.46 cr and net loss was Rs 69.39 cr. Other income was Rs 108.97 cr, equivalent to -1460.72% of the negative PBT, while the reported -830.16% tax rate reflects the negative PBT rather than a normal tax burden.
Margin remains near the bottom of Healthcare peers
The operating margin had risen from 5.52% in Q1FY26 to 16.74% in Q4FY26 before falling to 8.6% in Q1FY27, so the latest quarter marks a sharp reversal rather than a continuation of the prior four-quarter climb. Among 12 Healthcare peers that have reported, Piramal Pharma's margin was 20.05 percentage points below the 28.65% median and ranked second from the bottom.
CDMO and PCH supplied the reported growth
Management said CDMO revenue grew 19% year on year, supported by RFP activity, order inflows, demand and execution across sites, while PCH grew 15% on Power Brands and e-commerce. The company said customer decision-making timelines remain prolonged despite higher RFP activity, and identified converting RFPs into orders while maintaining win rates as a key growth driver.
No immediate market reaction after the filing
The results were filed after market close, so there is no post-result market reaction to assess yet. Across the eight recent result reactions in the stock's history, four were positive and four negative, with a median absolute move of 2.63%, indicating a mixed but generally contained response pattern.
Q1FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹2,270 cr | ₹2,752 cr | -17.51% | +17.39% |
| Other income | ₹109 cr | ₹-116 cr | — | +11.52% |
| Expenses | ₹2,075 cr | ₹2,291 cr | -9.45% | +13.56% |
| Operating profit | ₹195 cr | ₹461 cr | -57.61% | +82.94% |
| Operating margin (%) | 8.60% | 16.74% | — | — |
| Interest | ₹88 cr | ₹83 cr | +6.13% | +2.24% |
| Depreciation | ₹224 cr | ₹218 cr | +2.37% | +13.32% |
| Profit before tax | ₹-7 cr | ₹43 cr | — | +90.56% |
| Tax | ₹62 cr | ₹52 cr | +19.49% | +2210.82% |
| Net profit | ₹-69 cr | ₹-9 cr | -686.73% | +15.07% |
| EPS (₹) | ₹-0.52 | ₹-0.07 | -642.86% | +16.13% |
Operating margin of 8.60% compares with a Healthcare sector median of 28.65% across 12 peers that have reported Q1FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- CDMO revenue grew 19% year on year, supported by RFPs, order inflows, demand and execution across sites.
- PCH delivered 15% growth in Q1FY27, driven by Power Brands and e-commerce.
Guidance & outlook
- Converting RFPs into orders while maintaining win rates is identified as a key growth driver.
Planned next quarter
- Kenalog supplies are scheduled to start from Q2FY27.
Expansion
- Piramal completed commercial-scale payload-linker development and manufacturing capability at Riverview, US.
New products
- Piramal launched the i-choose master brand for its women's intimate care portfolio.
New initiatives
- The company strengthened commercial capabilities through an expanded team, sharper market coverage and deeper customer engagement.
- Piramal collaborated with Ajinomoto Bio-Pharma Services on next-generation conjugation technology.
- The company launched i-choose as a unified master brand for its women's intimate care portfolio.
- Piramal continues investing in 505(b)(2), complex and differentiated generics, and branded products through in-licensing and co-development.
Competition
- Piramal maintained the number-one US Sevoflurane position with a 48% value share.
- Piramal maintained the number-one position in the US intrathecal Baclofen market.
Problems & risks
- Customer decision-making timelines remain prolonged despite a significant increase in RFP activity.
- Inflationary pressures persisted despite improved utilization, pricing discipline and operational excellence.
- CHG maintained cost discipline amid supply and input-cost headwinds.
- Injectable pain management is addressing product availability by collaborating with suppliers.
What to watch
- Whether operating margin recovers from 8.6% after the 8.14-percentage-point sequential decline.
- CDMO revenue growth relative to the 19% year-on-year increase reported in Q1FY27.
- Whether Kenalog supplies start in Q2FY27, as management said they were scheduled to.