Laurus Labs bets big on CDMO as growth pushes margins higher in FY26

Laurus Labs is stepping up investments in new technologies and capacity over the next two years, even as a move towards its contract development and manufacturing (CDMO) business drove a sharp improvement in margins and profitability in FY26.

The company said capital expenditure intensity will increase over FY27 and FY28 to support expansion across small molecules, fermentation, peptides, and gene therapy platforms, as it builds capabilities in higher-value segments .

This comes after Laurus Labs reported EBITDA margins of 26.8% for FY26, up from 20.1% a year earlier, supported by operating leverage and a favourable product mix. Net profit rose 148% to ₹889 crore, while EBITDA increased 64% to ₹1,826 crore on revenue of ₹6,813 crore, up 23% year-on-year .

“We significantly accelerated our performance in FY26, delivering strong revenue growth and expanded profitability, backed by successful commercial supplies for NCE programs, new launches ramp-up and sustained leadership in Anti-retroviral segment,” said Satyanarayana Chava, Founder and Chief Executive Officer, Laurus Labs .

He added that the company’s portfolio transformation is underway, with investments in new technologies and integrated capabilities aimed at laying the foundation for future growth .

The CDMO business remained the key driver, with revenue rising 36% to ₹2,080 crore during the year, led by commercial supplies for new chemical entity (NCE) programmes and ramp-up of late-stage projects. Within this, small molecules revenue grew 38% to ₹1,896 crore, while the bio segment reported 15% growth to ₹184 crore .

Gross margins improved by over 5 percentage points to 60.4%, reflecting a higher contribution from CDMO operations, the company said.

V V Ravi Kumar, Executive Director and Chief Financial Officer, said the company continues to see demand across its integrated offerings. “Our balance sheet remains well positioned to support key CAPEX program ahead,” he said .

The generics business, reported under affordable medicines, grew 18% to ₹4,733 crore, supported by volume growth in anti-retroviral (ARV) products and expansion in developed markets such as the US and Europe .

For the fourth quarter, Laurus Labs reported revenue of ₹1,812 crore, up 5% year-on-year, while EBITDA rose 10% to ₹523 crore, with margins at 28.9% .

The company said it continues to invest in capacity and scale, as it builds an integrated platform across CDMO and generics businesses, with focus on complex chemistry and emerging technology areas.