SAKAR - Sakar Healthcare

📊 NSE: SAKAR 🏢 Pharmaceuticals - Indian - Bulk Drugs & Formln 📅 Last Updated: 12/14/2025 12:39

💰 Financial Performance

Revenue Growth by Segment

Consolidated revenue grew 16% YoY in FY25 to INR 177.58 Cr, with the oncology segment being the primary driver, showing an 80% increase in revenue. In H1 FY26, revenue reached INR 110.30 Cr, a 31.4% increase YoY, driven by continued oncology scale-up.

Geographic Revenue Split

The company exports to 60+ countries across APAC, Latin America, Africa, CIS, and Europe. While specific regional percentages are not disclosed, own-brand exports are identified as a high-margin growth driver.

Profitability Margins

Net Profit Margin improved from 7.61% in FY24 to 10% in FY25. Gross Profit Margin remained stable at 46% in H1 FY26. Return on Net Worth improved from 4.45% to 6.13% in FY25 due to improved PAT of INR 17.50 Cr (up 50% YoY).

EBITDA Margin

Operating margins improved to 28.4% in FY25 from 25.4% in FY24. However, EBITDA margin moderated to 20% in Q2 FY26 (down from 27% YoY) and 22% in H1 FY26 (down from 26% YoY) due to a 7-8x spike in business development and travel expenses.

Capital Expenditure

Net cash outflow for investing activities was INR 27.40 Cr in FY25, primarily directed toward facility modernization and the oncology injectable plant capex. H1 FY26 investing activities totaled INR 27.40 Cr.

Credit Rating & Borrowing

The long-term credit rating has a 'Positive' outlook. Total debt stood at INR 71.86 Cr as of September 2025, with a comfortable Debt-to-Equity ratio of 0.3x in FY25. Interest coverage was reported at 8.95x in H1 FY23.

⚙️ Operational Drivers

Raw Materials

Oncology Active Pharmaceutical Ingredients (APIs) including Imatinib, and specialized chemicals for formulations. 21 APIs are developed in-house to ensure vertical integration.

Import Sources

Not specifically disclosed, but the company operates an API-integrated unit to reduce external sourcing dependency.

Capacity Expansion

Current operations include an EU GMP-approved oncology oral and injection unit. Capex for an oncology injectable plant is currently in process to reach an optimum scale for the aspirational INR 1,000 Cr revenue target by FY30.

Raw Material Costs

Raw material costs contributed to a 200 bps margin moderation in Q1 FY26. The company uses an API-integrated model (21 in-house APIs) to mitigate price volatility and ensure supply stability.

Manufacturing Efficiency

The company maintains 277 product SKUs and is focusing on higher-margin oncology products to improve blended operating margins, which reached 28.4% in FY25.

📈 Strategic Growth

Expected Growth Rate

57%

Growth Strategy

Growth is driven by a management target of INR 280 Cr for FY26, supported by 49 oncology product agreements and a contract manufacturing deal with Accord Healthcare (signed Feb 2025). The company is leveraging 11 new marketing authorizations (6 in Europe, 5 in Emerging Markets) and has 80+ dossiers pending to trigger export growth in Q4 FY26.

Products & Services

Oncology oral tablets, oncology injections, Active Pharmaceutical Ingredients (APIs) such as Imatinib, and CDMO/CMO services for multinational pharmaceutical companies.

Brand Portfolio

Sakar Healthcare (Own Brand Exports to 60+ countries).

New Products/Services

Received first patent for oncology product Imatinib; R&D is actively developing patent non-infringing products for European partners.

Market Expansion

Expanding footprint in Europe, APAC, Latin America, Africa, and CIS; 80+ dossiers submitted worldwide for new registrations.

Strategic Alliances

Contract manufacturing agreement with Accord Healthcare Limited signed in February 2025 to scale oncology operations.

🌍 External Factors

Industry Trends

The industry is shifting toward specialized oncology care. Sakar is positioned for this with an 80% growth in oncology revenue in FY25. EU GMP compliance is a critical industry standard that Sakar has achieved to access European markets.

Competitive Landscape

Competes in the global oncology formulations and CDMO market against both domestic and international pharmaceutical firms.

Competitive Moat

The moat consists of a research-driven, API-integrated oncology unit with EU GMP approval. This high regulatory barrier, combined with 21 in-house APIs and a patent for Imatinib, provides a sustainable cost and compliance advantage.

Consumer Behavior

Rising global demand for affordable oncology treatments is driving the shift toward generic oncology formulations and CDMO services.

Geopolitical Risks

Trade barriers or regulatory changes in the 60+ export countries could impact the 80+ pending dossiers and marketing authorizations.

⚖️ Regulatory & Governance

Industry Regulations

Strict adherence to EU GMP (European Union Good Manufacturing Practice) and EMA (European Medicines Agency) standards for exports. Compliant with SEBI Listing Regulations 17 to 27.

Taxation Policy Impact

Effective tax rate is approximately 20% based on H1 FY26 figures (PBT of INR 10.74 Cr vs PAT of INR 9.21 Cr).

Legal Contingencies

No material non-compliance or penalties imposed by SEBI or Stock Exchanges in the last three years. Financial statements for FY25 contain no audit qualifications.

⚠️ Risk Analysis

Key Uncertainties

Execution risk associated with scaling oncology operations to reach the INR 1,000 Cr FY30 target and potential delays in marketing authorizations for the 80+ submitted dossiers.