Syngene share price cracks 10% as FY26 guidance spooks stock investors

Shares of Syngene International Ltd tumbled 10 per cent in Thursday's trade after the company gave a muted revenue guidance for FY26. Post Q4 results, Managing Director and CEO at Syngene International, Peter Bains, said revenue growth is expected to be in the early teens that he said reflected a broad-based growth across research, development and manufacturing services. But adjusted for inventory balancing in large molecule commercial manufacturing at client level, Bains expected revenue growth to be only in mid-single digits. 

Besides, CFO Deepak Jain said Ebitda margin may moderate to mid-twenties and year-on-year (YoY) profit after tax (PAT) may see some decline. Following this, the stock crashed 10 per cent to hit its lower circuit limit at Rs 675.05 on BSE. 

For FY25, Syngene reported a revenue growth of 4 per cent and a profit fall of 8 per cent (before exception items). After a muted first half, driven by a sectoral downturn in US biotech funding, there was a return to growth in the second half of the year, the company said. 

Excluding exceptional items, the company reported 3 per cent drop in Q4 profit at Rs 183 crore compared with Rs 189 crore in the same quarter last year. Revenue was up 11 per cent at Rs 1,018 crore against Rs 917 crore in the year-ago quarter. Ebitda margin for the quarter fell to 35 per cent against 35.7 per cent YoY.  

"Looking at the year ahead, while the wider global market dynamics remain uncertain, we expect the business momentum to continue with pipeline build in both small and large molecules, supported by new pilot programs and conversion of existing pilots in discovery services. On an underlying basis for fiscal year 2026, we expect revenue growth in the early teens reflecting a broad-based growth across research, development and manufacturing services. Adjusted for inventory balancing in large molecule commercial manufacturing at client level, the reported revenue growth is likely to be at mid-single digit," Bains said.

CFO Deepak Jain said as his company brings the new biologics manufacturing facilities into operations, the additional operating costs and depreciation will impact margins. With this, he expects Ebitda margin to moderate from current levels to the mid-twenties and year-on-year decline in profit after tax. 

Syngene will be hosting an investor call at 11:00 am IST today, where the senior management will discuss the company's performance and answer questions from participants.