Cipla share price slips as Q2 profit falls 35% on weak US sales
By Rohit SharmaMarkets Analyst, Peepals Business
Representative image: stevepb / Pixabay
Cipla's Q2 FY27 profit fell 35% to Rs 878 crore on weaker US generic sales, results on 27 October 2026 showed; its shares traded 0.93% lower on the NSE.
What Happened
Shares of drugmaker Cipla traded lower on Tuesday, 27 October 2026, after the company reported a 35% year-on-year fall in its September-quarter profit. Consolidated net profit for the second quarter of 2026-27 (July to September) dropped to Rs 878 crore from Rs 1,351 crore a year earlier, as sales in North America fell sharply. At 2:53 pm, Cipla shares were at Rs 1,342.50 on the National Stock Exchange (NSE), down 0.93%, according to market data reported after the results.
Key Facts
- Net profit: Rs 878 crore in Q2 FY27, down 35% from Rs 1,351 crore in Q2 FY26.
- Revenue from operations: Rs 7,404 crore, down 2.4% year on year.
- EBITDA (earnings before interest, tax, depreciation and amortisation): Rs 1,388 crore, down from Rs 1,895 crore; margin 18.7% against 25% a year ago.
- North America: revenue down 19%, to about 172 million US dollars, as sales of generic Revlimid (lenalidomide, a cancer drug) kept falling amid competition.
- India: domestic revenue up 12% to Rs 3,516 crore; the company said its One-India business had its highest-ever quarterly sales.
- Estimates: analysts' consensus for profit ranged from about Rs 942 crore to Rs 966 crore depending on the poll, so the result was below expectations.
- Share price: Rs 1,342.50 on the NSE at 2:53 pm on 27 October, down 0.93%.
Why It Matters
Cipla is one of India's largest drugmakers, and its results are watched as a signal for the pharma sector. The quarter shows a split business. At home, sales grew strongly. In the United States, its largest overseas market, revenue dropped as one big product faded.
That product is generic Revlimid. Revlimid is a cancer medicine, and when its patent protection began to lapse, a few generic makers such as Cipla were allowed to sell limited quantities of cheaper copies in the US, earning high margins. As more companies enter the market, prices and volumes fall. Several Indian drugmakers have flagged this "Revlimid cliff" as a drag on profits, and Cipla's quarter shows its impact clearly: the profit margin fell from 17.8% to 11.9%.
The fall in the share price was modest compared with the drop in profit, which suggests that much of the decline in US sales had been expected. Before the results, the brokerage Nomura had kept a Buy rating with a Rs 1,510 target price in a note on 26 October, while expecting the EBITDA margin to recover to 19.2%; the reported margin of 18.7% came in a little below that. Analysts' views are their own, and share prices can move sharply in either direction after results.
The company also changed how it classifies certain marketing and promotional expenses, which affected reported revenue but not profit or cash flow, according to one report.
| Measure | Q2 FY26 | Q2 FY27 |
|---|---|---|
| Revenue from operations | About Rs 7,586 crore | Rs 7,404 crore |
| EBITDA | Rs 1,895 crore | Rs 1,388 crore |
| EBITDA margin | 25.0% | 18.7% |
| Net profit | Rs 1,351 crore | Rs 878 crore |
Impact
Short-term: The stock traded slightly lower on the day of the results. Investors will watch the company's comments on new US launches and on how quickly the Revlimid decline levels off.
Long-term: Cipla's growth will depend more on its India business, where it posted record sales, and on new products abroad to replace lost Revlimid income. Its margins are likely to stay below last year's levels until new launches add up.
Who is affected: Cipla shareholders and employees, mutual funds and other investors holding pharma stocks, patients who use its generic medicines, and other Indian drugmakers facing the same US generic competition.
Key Takeaway
Cipla's Q2 FY27 profit fell 35% to Rs 878 crore on a 19% drop in North America sales, while India sales grew 12%, and its shares were down 0.93% on the NSE on 27 October 2026.
Questions and Answers
Why did Cipla's share price fall on 27 October 2026?
Cipla shares traded 0.93% lower at Rs 1,342.50 on the NSE at 2:53 pm after the company reported a 35% fall in September-quarter profit to Rs 878 crore, below analysts' estimates.
Why did Cipla's profit fall in Q2 FY27?
Mainly because North America revenue fell 19%, as sales of its generic version of the cancer drug Revlimid declined amid rising competition. The EBITDA margin dropped to 18.7% from 25%.
How did Cipla's India business perform?
Revenue from India rose 12% year on year to Rs 3,516 crore, and the company said its One-India business recorded its highest-ever quarterly sales.
What is EBITDA?
EBITDA stands for earnings before interest, tax, depreciation and amortisation. It shows how much a company earns from its core operations before financing costs, taxes and accounting charges for assets.
Disclaimer: Prepared by the Peepals newsroom from publicly available sources with AI assistance. Information is accurate to the best of our knowledge at the time of publication and may change. Images may be representative. Not professional advice. Report an error via our contact page.
By Rohit Sharma, Markets AnalystCovers Markets Watch and more for Peepals Business. All stories by Rohit Sharma
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Rohit Sharma is a pen name of the Peepals Global Editorial Team, which researches, fact-checks and publishes every story. The portrait is an illustration.
