Strides Pharma Science Ltd
(NSE:STAR)
₹
999
-4.8 (-0.48%)
Market Cap: 92.08 Bil
Enterprise Value: 108.03 Bil
PE Ratio: 15.01
PB Ratio: 2.97
GF Score: 71/100 
Q1 2027 Strides Pharma Science Ltd Earnings Call Transcript
Jul 31, 2026 / 11:30AM GMT
Release Date Price:
₹1025
(-4.46%)
Key Points
Positve
- Strides Pharma Science Ltd (BOM:532531) delivered a 13% year-on-year revenue growth in Q1 FY27, with ex-US markets growing 17%, validating its diversification strategy.
- Gross margins expanded by 60 basis points year-on-year to 60.9%, driven by a favorable business mix in ex-US markets, and the company expects to maintain margins in the 58%-60% range.
- The company maintained EBITDA margins at 18.2%, slightly ahead of Q4 FY26, despite absorbing INR131 million in additional costs from geopolitical disruptions.
- Strides Pharma Science Ltd (BOM:532531) reported a 57% year-on-year increase in reported PAT to INR166 crores, boosted by a gain from divesting its stake in Vivot Path.
- The company's net debt-to-EBITDA ratio improved to 1.52x, and CARE Ratings upgraded its long-term bank facilities to CARE A+ stable, reflecting consistent financial performance.
- The US business maintains a strong portfolio with top-three positions in 37 products contributing ~70% of revenues, and the company is investing in growth platforms like controlled substances, nasal sprays, and transdermal patches.
- The ex-US business continues to show strong momentum, with growth across Europe, UK, Nordics, Australia, and Africa, and the company expects this segment to grow faster than the company average.
- The company has a clear strategy to achieve $375 million in North American revenue by FY28, with multiple levers including OTC, controlled substances, new product launches, and partnerships.
- Strides Pharma Science Ltd (BOM:532531) improved its ECOVAD score to 68, a 19-point year-on-year improvement, reflecting its commitment to sustainability.
- The company reduced net debt by INR12 crores during the quarter and continues to focus on improving its net debt-to-EBITDA ratio.
Negative
- The US business revenue remained flat at $68 million, impacted by increased competition in certain products, and the company expects H1 to remain soft.
- The ex-US business saw a sequential decline to $63 million from $70 million in Q4 FY26, due to supply chain disruptions and shipping delays, though management views this as a timing issue.
- Freight costs increased to 6.2% of revenue from 5.3% a year ago, reflecting ongoing geopolitical disruptions and inflationary pressures.
- The company faces uncertainty regarding proposed US tariffs on generic pharmaceutical products starting August 2028, with limited visibility on the final implementation framework.
- Controlled substances growth has been slower than expected, with quota allocations taking longer to materialize, and the segment currently contributes only about 5% of revenues.
- The company experienced delays in some product approvals, which are expected to materialize over the coming quarters, impacting near-term US growth.
- Cash-to-cash cycle increased by 7 days year-on-year to 123 days, driven by a 24-day increase in inventory levels as the company prioritized supply chain resilience.
- Operating cash flow conversion was at 47% of EBITDA, lower than ideal, due to increased working capital requirements.
- The company's ROCE on a TTM basis moderated to 15.3% from 15.8% in FY26, as capital employed grew on recent investments and currency movements.
- The geopolitical situation remains volatile, with ongoing supply chain disruptions, elevated freight costs, and longer transit times, which could continue to impact operations.
Operator
Ladies and gentlemen, good day and welcome to the Strides Pharma Sciences Limited Q1 FY27 Earnings Conference Call. (Operator Instructions). I now hand over the call to Mr. Abhishek.
Thank you and over.
Abhishek Singhal;IR Contact
Strides Pharma Science Ltd - Head of Investor Relations
/
Thank you Shafi. Very good evening and thank you for joining us today for Stride's earnings call for the first quarter of financial year 2026-27.
Today we have with us Badri, Managing Director and Group CEO and Vikesh Kumar, Group CFO to share the highlights of the business and financial for the quarter.
I hope you've gone to our results release and the quarterly investor presentation that have been uploaded on our website as well as the stock exchange website. The transcript for this call will be available in a week's time on the company's website.
Please note that today's discussion may contain forward-looking statements and must be viewed in context to the risk inherent in our business. After the end of this call, in
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