Torrent Pharma's profit falls as financing and depreciation costs surge
Revenue rose 50.79% year on year, but a 525.00% jump in interest expense pushed profit before tax down 6.83%.
Filed 23 Oct 2026, 16:45 IST · after market close · Torrent Pharmaceuticals Ltd (TORNTPHARM)
Key takeaways
- Consolidated revenue grew +50.79% year on year, but net profit fell -9.64% as interest rose +525.00% and depreciation +198.53%.
- Operating margin improved 0.66 percentage points year on year to 33.46%, but narrowed 0.35 percentage points sequentially as expenses grew +1.72% against revenue growth of +1.18%.
- The stock rose +0.57% in the initial reaction, a muted move versus its 4.01% median absolute reaction after the past eight results.
Price around the results
Revenue growth did not reach profit
Torrent Pharmaceuticals reported consolidated revenue of Rs 4,979 cr, up +50.79% year on year, while operating profit rose +53.83%. That operating gain did not flow through to net profit because interest increased to Rs 300 cr from Rs 48 cr and depreciation to Rs 609 cr from Rs 204 cr. Profit before tax consequently fell -6.83% and net profit -9.64% year on year.
Sequential margin eased after Q1 expansion
Year on year, expenses grew +49.30%, slower than revenue, lifting operating margin by 0.66 percentage points. Sequentially, however, expenses grew +1.72% against revenue growth of +1.18%, narrowing margin by 0.35 percentage points from Q1FY27. The tax rate also rose 4.76 percentage points sequentially to 27.54%, while negative other income was equivalent to -2.71% of pre-tax profit, so it was a drag rather than a profit-quality support.
Margin remains above healthcare peers
The 33.46% operating margin was 10.05 percentage points above the 23.41% median for the nine healthcare peers that had reported the same quarter. The quarterly trend is uneven: margin rose from 32.47% in Q1FY26 to 32.94% in Q3FY26, fell to 32.31% in Q4FY26, then reached 33.81% in Q1FY27 before easing this quarter. This is a sequential pullback, not a third straight quarter of decline.
Initial stock reaction was smaller than usual
The stock rose +0.57% at the initial reaction point after the results, with a +0.81% opening gap and trading volume at 2.05 times the reference level. That move was below the 4.01% median absolute move seen after the past eight results, although the longer record was positive in seven of those eight instances. The results were filed after market close on 23 October 2026.
Q2FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q2FY27 | Q1FY27 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹4,979 cr | ₹4,921 cr | +1.18% | +50.79% |
| Other income | ₹-20 cr | ₹-33 cr | +39.39% | +50.00% |
| Expenses | ₹3,313 cr | ₹3,257 cr | +1.72% | +49.30% |
| Operating profit | ₹1,666 cr | ₹1,664 cr | +0.12% | +53.83% |
| Operating margin (%) | 33.46% | 33.81% | — | — |
| Interest | ₹300 cr | ₹305 cr | -1.64% | +525.00% |
| Depreciation | ₹609 cr | ₹593 cr | +2.70% | +198.53% |
| Profit before tax | ₹737 cr | ₹733 cr | +0.55% | -6.83% |
| Tax | ₹203 cr | ₹167 cr | +21.56% | +1.50% |
| Net profit | ₹534 cr | ₹566 cr | -5.65% | -9.64% |
| EPS (₹) | ₹14.05 | ₹14.87 | -5.51% | -19.48% |
Operating margin of 33.46% compares with a Healthcare sector median of 23.41% across 9 peers that have reported Q2FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | +0.57% | -0.11% |
Volume on the results session was 2.05× its 20-day average.
What to watch
- Whether operating margin recovers from 33.46% after the 0.35-percentage-point sequential decline.
- Whether interest and depreciation remain near Rs 300 cr and Rs 609 cr after their sharp year-on-year increases.
- Whether the tax rate moves down from 27.54% after rising 4.76 percentage points sequentially.