Pharma stock jumps 9% after reporting 91% YoY increase in net profit

SYNOPSIS: Rubicon Research Ltd shares rose 9% after Q3 results, with revenue up 52% YoY to ₹476 crore, net profit up 91% YoY to ₹72.8 crore, and its earnings per share (EPS) for the quarterly period stood at ₹4.46

The shares of the Pharmaceuticals company specializing in the development, manufacturing, and commercialization of complex, high-value generic pharmaceutical formulations are in focus following their Q3 results, with a 91 percent rise in profit and strong R&D spend.

With a market capitalization of Rs. 12,203.88 Crores on Wednesday, the shares of Rubicon Research Ltd jumped up to 9 percent, reaching a high of Rs. 788.85 compared to its previous close of Rs. 723.25.

What Happened

Rubicon Research Ltd, engaged in the development, manufacturing, and commercialization of complex, high-value generic pharmaceutical formulations are in the spotlight today as it has announced its Q3 results as follows:

Its Revenue from operations rose by 52 percent YoY from Rs. 313 Crores in Q3FY25 to Rs. 476 Crores in Q3FY26, and it rose by 16 percent QoQ from Rs. 412 Crores in Q2FY26 to Rs. 476 Crores in Q3FY26.

Its Net Profit YoY rose by 91 percent from Rs. 38.1 Crores in Q3FY25 to Rs. 72.8 Crores in Q3FY26, and on a QoQ basis, it rose by35 percent from Rs. 53.8 Crores in Q2FY26 to Rs. 72.8 Crores in Q3FY26. The earnings per share (EPS) for the quarterly period stood at Rs. 4.46, compared to Rs. 2.50 in the previous year’s quarter.

Q3 Performance

The top 5 products contributed 35% of revenue (up from 30% in Q2FY26 and 34% in Q1FY26), while the top 10 products accounted for 53% (vs 51% in Q2FY26 and 56% in Q1FY26), and the pricing remained stable, supported by a focus on specialty and differentiated products.

The USD revenue for Q3 FY26 was $53 mn, up 46% YoY ($37 mn in Q3 FY25) and 14% QoQ ($47 mn in Q2 FY26), with ~98% of revenue USD-denominated. During 9M FY26, the company received 9 product approvals, with a strong commercialization rate of 93%, and the specialty portfolio contributed 31.3% to gross profit, supported by a robust pipeline.

Rubicon Research is an innovative Indian pharmaceutical company focused on developing advanced formulations for regulated markets, particularly the United States. Established in 1999, the company specializes in drug-device combinations, oral solids, liquids, and sterile injectables.

It operates US FDA-approved manufacturing facilities in Maharashtra and maintains a robust portfolio of ANDA and NDA filings. With a strong emphasis on research and development, Rubicon continues to expand its range of specialty products and complex drug delivery solutions.

The company reported R&D expenses at 11.0% of operating revenue for Q3 FY26, reflecting its strategic focus on innovation. Management views R&D spending as a key driver of future revenue and aims to sustain similar productivity in the coming years. With a planned total R&D investment of over Rs. 500 crore across FY26, FY27, and Q1 FY28, the company expects strong visibility into growth for FY29/30 and beyond.

R&D expenditure is projected to remain at an industry-leading 10–11% of revenue for the foreseeable future, including beyond FY28. The company will continue its policy of fully expensing R&D in the P&L, ensuring consistent investment in innovation while maintaining transparency in financial reporting.

The company has delivered strong financial performance, with a ROCE of 26% and ROE of 28.9%, reflecting efficient use of both capital and equity. Its debt-to-equity of 0.88 shows a balanced approach to leveraging, while profit growth of 22.8% CAGR over the last five years highlights consistent scalability and strong profitability.

Operationally, the company has become more efficient, with debtor days improving from 143 to 92 and working capital requirements reducing from 59.3 to 45.8 days. These improvements boost cash flow, lower financing needs, and position the business well for sustainable growth going forward.

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