Aurobindo Pharma Expects China Plant to Break Even at EBITDA Level this Year

Aurobindo Pharma expects its China facility to break even in the third quarter of the current financial year, according to its CFO Santhanam Subramanian.

The Hyderabad-based drug maker commenced operations at the facility in the last week of November 2024 and is now ramping up production.

"This facility with an initial capacity of 2 billion units plus is ramping up as expected and will begin contributing to revenue in the coming quarters and is expected to break even at the EBITDA (earnings before interest, taxes, depreciation, and amortisation) level by Q3 FY26," Subramanian said in an analyst call.

He noted that around USD 145 million has been invested in the facility, which commenced production and invoicing in Q4 FY25 and Q1 FY26, respectively.

Elaborating on other investments, Subramanian said the company has invested about USD 70 million in two US facilities, with production expected to start in the current fiscal year.

Elaborating further, he noted that the company plans to file for more than 20 products in the US and Europe from its Eugia-V plant in Visakhapatnam.

He noted that the company has invested around USD 30 million in the Biologics CMO business so far, and the balance of USD 100 million plus capital is expected to be invested by March 2027.

On business outlook, Subramanian stated: "Looking ahead, we remain optimistic about sustaining our growth momentum. Our confidence is supported by expected volume expansion, continued product launches and a stable pricing environment, especially in the US and Europe".

Commercial operations ramping up at new manufacturing sites would further support the topline growth and margin improvement in the upcoming quarters, he added.

"We are confident of achieving our internal target margin of 20-21 per cent in FY26," Subramanian stated.

Aurobindo Pharma reported a 10 per cent year-on-year dip in its consolidated net profit to Rs 824 crore for the June quarter, due to a fall in sales in the US and API business vertical.

Its revenue from operations increased to Rs 7,868 crore for the June quarter against Rs 7,567 crore in the year-ago period.