Morepen Laboratories Ltd reported a 117% year-on-year increase in profit after tax (PAT) to ₹89 crore for Q2 FY27, driven by the scale-up of contract development and manufacturing organisation (CDMO) supplies, improving business mix and higher operating leverage. Revenue rose 81% to ₹755 crore in the quarter ended September 30, 2026.
EBITDA surged 273% year-on-year to ₹132 crore, while the EBITDA margin expanded by 897 basis points to 17.45%, indicating stronger operating profitability as commercial CDMO supplies scaled up.
Exports increased 131% to ₹397 crore, while the medical devices business recorded 65% growth in revenue to ₹208 crore.
CDMO emerges as a key growth driver
CDMO revenue reached ₹253 crore in Q2 FY27, compared with ₹58 crore in Q1 FY27. First-half CDMO revenue stood at ₹311 crore, with the segment accounting for 52% of combined active pharmaceutical ingredients (API) and CDMO revenue in the September quarter.
The company said its previously announced ₹825 crore global CDMO mandate had moved into regular commercial supplies, marking a shift from validation and initial supplies to larger-scale execution.
Morepen Laboratories Chairman and Managing Director Sushil Suri said the expansion of CDMO operations, growing international business and strong medical devices performance were reshaping the company’s earnings profile. He added that H1 FY27 EBITDA had crossed ₹200 crore, providing a stronger base for investments in manufacturing capacity and future growth.
Capacity expansion targets 800 KL
Morepen has completed the first phase of its capacity expansion ahead of schedule, increasing API and CDMO capacity from approximately 535 kilolitres (KL) to 614 KL.
Civil work has commenced for the next phase, which will take capacity towards 800 KL, with completion targeted for Q2 FY28.
Morepen Laboratories Managing Director Sanjay Suri said the company was executing CDMO orders in line with customer programmes while strengthening capabilities in high-potency APIs and new technologies. It is also engaging with global pharmaceutical customers for additional development and manufacturing opportunities.
During the quarter, Morepen submitted its first US Abbreviated New Drug Application (ANDA) for Sitagliptin Tablets USP, expanding its finished-dosage development and regulatory capabilities.
Medical devices and higher-value APIs
The medical devices business generated ₹208 crore in Q2 FY27 and ₹399 crore in H1 FY27, representing year-on-year growth of 65% and 39%, respectively. The business has an installed base of approximately 20 million glucose meters and annual test-strip volumes of around 500 million.
In the API business, newer molecules increased their contribution from 14% of API revenue in H1 FY26 to 25% in H1 FY27. Exports account for approximately 76% of traditional API revenue.
The company also reported improvements in capital efficiency. Trailing 12-month return on capital employed rose to 18.8% from 9.4% in FY26, while return on equity increased to 13.6% from 7.6%. Receivable days declined to 49 from 66, and the debt-to-equity ratio stood at 0.23 times.