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Informist, Friday, Feb. 13, 2026
 

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--Biocon: Most capex now behind, operating leverage to play out going forward 
--CONTEXT: Comments by Biocon's management in post-earnings investor call 
--Biocon: Group-level capex to moderate to $225 mln from $275 mln 
--Biocon: Expect FY26 margin in mid-20s 
--Biocon:See Liraglutide traction continuing, hope to launch pdt in new mkts 
--Biocon: Hope to benefit from limited competition in GLP-1 segment 
--Biocon: See strong insulin demand globally despite growth in GLP-1 sales 
--Biocon: Looking to double insulin production capacity in FY26 
--Biocon: Looking to commercialise semaglutide in India through partners 

 

By Eshitva Prakash and Shreya Shetty

 

MUMBAI – Biocon Ltd. is looking to commercialise weight-loss drug Semaglutide in India through a business-to-business partner after it manages to secure prior regulatory approvals, the company's management said in a post-earnings analysts conference call Friday. Additionally, the company is looking to double its insulin production capacity in 2025-26 (Apr-Mar) despite innovator companies focussing on glucagon-like peptide-1 product launches and production ramp-ups, as Biocon's management believes that global demand for insulin continues to be strong.

 

"We do not expect that the insulin demand globally will reduce," Biocon's management said, "And we expect us to be a very, very significant player in the insulin space." The company already has Liraglutide in its portfolio, which, similar to Semaglutide, is used to treat certain types of diabetes. Analysts have previously flagged concerns that the market share of synthetic insulin drugs may be hurt by new launches of the GLP-1 class of drugs. 

 

Biocon has already signed an out-licensing agreement with Ajanta Pharma Ltd. to market Semaglutide in 23 countries. The company continues to expect strong traction for its GLP-1 drugs and will be launching the product in a few more European countries. "It's a de-growing market because a lot of patients over the last couple of years have moved to Ozempic," the management said. "But we still see that there is a lot of demand (for Liraglutide)... there is limited competition, and we have a very good play that will drive the growth."  

 

"If we do a clinical trial in India and if we do still see a good economical value and return on the clinical investment, then of course the go-to-market strategy will be through a partner," the management said. The company added that India is one of the few markets in the world where it needs a clinical trial, unlike the US, Europe, and other markets where a clinical trial is not needed. "That's why it's a decision whether we wait for one of the ICH (International Council for Harmonisation) approval and then apply for a clinical waiver like we did for Liraglutide versus spending that money which is not small with significant investment in phase three clinicals," the management said.

 

For the quarter ended December, Biocon reported a net profit of INR 1.44 billion, lower than the Street's estimates. The company's revenue also fell short of analysts' expectations and grew 9% on year to INR 41.73 billion. Revenue from the company's biosimilars segment rose to INR 24.97 billion, up over 9% from the year-ago quarter. Sales of generics increased to INR 8.51 billion, up 24% on year and its research services revenue declined nearly 3% to INR 9.17 billion.

 

The company said its earnings before interest, tax, depreciation, and amortisation margin will be in the mid-20s for FY26. However, the company's management did not give specific details on what will drive this expansion. Biocon reported an EBITDA of INR 9.51 billion for the December quarter and its EBITDA margin improved to 22% from 20% a year ago.

 

"With major capex now largely behind us and operating leverage beginning to play out, we are progressing from a phase of balance sheet resilience into a cycle of sustainable growth, margin expansion, and a cash flow-led value creation," Kiran Mazumdar-Shaw, the company's executive chairperson said.

 

At a group-level, Biocon has been tracking roughly $275 million in capital expenditure every year and this expenditure is seen moderating to around $225 million, according to Kedar Upadhye, chief financial officer of Biocon Biologics. "Going forward, as the Malaysian capacity build-up gets over, I think we will see further moderation because largely, most (capex) will be used for maintenance across three companies," he said.

 

At 1209 IST, shares of Biocon traded 0.4 higher at INR 376.55 on the National Stock Exchange.  End

 

US$1 = INR 90.74

 

Edited by Deepshikha Bhardwaj

 

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