Neel AcharyAfter a challenging first half of FY26, Hikal Ltd is signalling confidence that second-half results will outperform H1, anchored on resumed supplies, capacity utilisation, and new product momentum.
The diversified chemicals and life-sciences firm is holding to its full–year guidance, underscoring strategic resilience and improving demand visibility across segments.
H1 performance and the H2 rebound narrative
In H1 FY26, Hikal reported a consolidated revenue of ₹699 crore and EBITDA of ₹32 crore, with lower margins reflecting deferments in pharma off-take and under-absorption of fixed costs. Management said the resumption of supplies is progressing well and expects H2 FY26 to bridge the majority of the impact from H1 deferments.
The first half was pressured by regulatory-linked deferments in pharmaceutical deliveries after a US FDA Official Action Indicated (OAI) status and subsequent warning letter. Despite that, no orders were cancelled and supply restoration commenced from October 2025, fuelling confidence for a stronger second half.
Management confidence and guidance
The management reiterated that demand visibility is improving and capacity utilisation across key facilities is broadening, a critical signal that H2 will gain traction relative to H1. He also noted the company’s diversified base and global footprint as buffers against volatility, reinforcing confidence in full–year commitments.
Hikal has maintained its full–year CapEx guidance of ₹200 crore, focused on high-ROI projects and strategic expansions, including the new high-potency API lab and kilo lab commissioning. These investments underline an expectation that product momentum and regulatory clearances will begin to reflect in financials after the first half.
Segment outlooks shaping the short-term narrative
In the pharmaceuticals division, deferred shipments from the first half are now being executed, and management expects a material uptick in H2 volumes as remediation plans near completion and supply chains normalise after regulatory-linked deferrals. The personal care and specialty chemicals businesses are also gaining traction, with 2–3 products slated for commercialisation in H2 FY26, helping offset cyclic pressures in core categories.
Meanwhile, in the crop protection segment, pricing pressures persist amid global overcapacity, but volumes are stabilising and the company is pursuing operational efficiency measures to support margins.
Looking ahead
With supply normalisation, improved capacity utilisation, new product launches and steady CapEx execution, Hikal is projecting a more robust H2 FY26 that should surpass H1 performance, while holding to its annual guidance for growth in key businesses and broader structural improvements.
