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With its new plant operational in New Jersey, US, Bengaluru-based Bioconis hoping to get some of the business from President Donald Trump's push for cheaper drugs and local manufacturing. It's likely to cost the company some of its profit margin.
"Yes, the wages are higher in the US, maybe, three times or four times. But, the number of people required to operate the facility is significantly lower compared to what we have in India. So, we will have an advantage of that, but short term again, which is till the facility reaches its peak capacity, we will see a margin impact," Siddharth Mittal, Managing Director and CEO of the $5 billion drugmaker, said in an interview with CNBC-TV18.
The new plant, which it acquired from Eywa Pharma in 2023, is likely to add $30 million to $40 million to its annual revenue once it starts operating at full capacity. Biocon's revenue in the first quarter of FY26 was ₹343 crore, a little less than $40 million at current exchange rates.
Biocon has been a stark underperformer among Indian pharmaceutical stocks in recent years.
Biocon has been a stark underperformer in recent years
Source: Screener. CAGR stands for compounded annual growth rate.
One of the reasons has been a relatively smaller profit margin compared to its peers.
Biocon's profitability has been significantly less than its peers over the last three years, ranging between 18% to 24% in each quarter compared to others who have clocked a operating profit of at least 25% and over 30% in most cases, according to data from Screener.
In the latest first quarter ended June 2025, the company's EBITDA margin shrank by 540 basis points to 19% compared to three months earlier. EBITDA, which is a measure of profitability of a company's core operations, stands for earnings before interest, tax, depreciation and amortisation.
The stock has been held up mutual funds in India
Foreign portfolio investors have more than halved their stake in Biocon in the last three years, from 15.8% in Sep 2022 to just over 6% in June 2025. Domestic institutional investors have piled on, nearly tripling their stake from 7.76% to over 22.8% at the end of June.
Shares of Biocon are down over 7% in the last one year, and has given a compounded annual return of 8% in the last five years.
However, 17 out of 19 analysts tracking Biocon have a buy rating with a consensus target of ₹384.2 apiece.
You can watch the entire conversation here:
Read more: Why share buybacks aren't as common in India anymore
"Yes, the wages are higher in the US, maybe, three times or four times. But, the number of people required to operate the facility is significantly lower compared to what we have in India. So, we will have an advantage of that, but short term again, which is till the facility reaches its peak capacity, we will see a margin impact," Siddharth Mittal, Managing Director and CEO of the $5 billion drugmaker, said in an interview with CNBC-TV18.
The new plant, which it acquired from Eywa Pharma in 2023, is likely to add $30 million to $40 million to its annual revenue once it starts operating at full capacity. Biocon's revenue in the first quarter of FY26 was ₹343 crore, a little less than $40 million at current exchange rates.
Biocon has been a stark underperformer among Indian pharmaceutical stocks in recent years.
Biocon has been a stark underperformer in recent years
| Stock | Profit growth (5-year CAGR) | Stock price (5-year CAGR) |
| Biocon | 7% | -4% |
| Sun Pharma | 24% | -26% |
| Divi’s Lab | 10% | 13% |
| Cipla | 29% | 16% |
| Torrent Pharma | 14% | 20% |
| Dr Reddy’s Lab | 22% | 7% |
Source: Screener. CAGR stands for compounded annual growth rate.
One of the reasons has been a relatively smaller profit margin compared to its peers.
Biocon's profitability has been significantly less than its peers over the last three years, ranging between 18% to 24% in each quarter compared to others who have clocked a operating profit of at least 25% and over 30% in most cases, according to data from Screener.
In the latest first quarter ended June 2025, the company's EBITDA margin shrank by 540 basis points to 19% compared to three months earlier. EBITDA, which is a measure of profitability of a company's core operations, stands for earnings before interest, tax, depreciation and amortisation.
The stock has been held up mutual funds in India
Foreign portfolio investors have more than halved their stake in Biocon in the last three years, from 15.8% in Sep 2022 to just over 6% in June 2025. Domestic institutional investors have piled on, nearly tripling their stake from 7.76% to over 22.8% at the end of June.
Shares of Biocon are down over 7% in the last one year, and has given a compounded annual return of 8% in the last five years.
However, 17 out of 19 analysts tracking Biocon have a buy rating with a consensus target of ₹384.2 apiece.
| Brokerage | Target price for Biocon |
| Phillip Securities | ₹440 |
| Citi | ₹430 |
| JM Financial | ₹424 |
| DAM Capital | ₹423 |
| HSBC | ₹413 |
You can watch the entire conversation here:
Read more: Why share buybacks aren't as common in India anymore
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