Hester Biosciences Limited (NSE: HESTERBIO) Q3 2026 Earnings Call dated Jan. 30, 2026
Corporate Participants:
Unidentified Speaker
Nisha Shetty
Rajiv Gandhi — Chief Executive Officer & Managing Director
Priya Gandhi — Executive Director
Analysts:
Madhur Rathi — Analyst
Hershel Mehta — Analyst
ravi Mehta — Analyst
Arya Shah — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to Hester Biosciences Q3 and 9 months FY26 earnings conference call hosted by ICICI Securities Limited. As a reminder, all participants line will be in listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Nisha Shetty from ICICI Securities Limited. Thank you. And over to you.
Nisha Shetty
Thank you Iqra. Good afternoon everyone. On behalf of ICICI Securities, I welcome you all on Q3 and nine month FY26 earnings conference call of Hester Biosciences Limited. And I thank the Hester Biosciences management team for giving us this opportunity to host this call today. On this call we have with us Mr. Rajiv Gandhi, CEO and Managing Director, Ms. Priya Gandhi, Executive Director and Mr. Ashish Desai, Chief Financial Officer. I will now hand over the call to the Hester management team for their opening remarks. Thank you. Over to you.
Rajiv Gandhi — Chief Executive Officer & Managing Director
Good afternoon everybody. This is Rajiv Gandhi and we, myself and our team, we are as happy to interact with you on this quarterly call which we do it on a quarter to quarter basis. I now hand over the talk to Priya Gandhi, Executive Director to take it further. Over to you. Priya.
Priya Gandhi — Executive Director
Hi. Good afternoon everyone. This is Priya Gandhi, Executive Director. Thank you for joining us to discuss our Q3 and 9 month FY26 results. As always, we appreciate your continued engagement and long term support as we build Hester with clear focus on science, operational discipline and sustained value creation. Speaking to you all, each quarter gives us the opportunity to reflect objectively on our progress and the learnings from the period gone by. Q3 FY26 marked a phase of improved execution and capacity strengthening for Hester, particularly in our poultry healthcare business. Even as parts of the animal healthcare portfolio continued to be impacted by timing related institutional delays about which I will talk on a standalone basis.
The revenue grew by 12% in Q3 and the profitability improved sharply with PAT up 140% year on year driven by a favorable product mix, operating and sustained cost discipline. For the period of nine months, revenue was down by 5% while profits increased 16% reflecting the operating discipline and business resilience we’ve been building across the organization. Coming on to the Poultry Healthcare division, the Poultry Healthcare Division delivered a strong performance, growing 32% in Q3 and 17% over nine months in this financial year. Growth was supported by deeper market penetration, improved placement, stronger distribution coverage and sustained demand for our core vaccine portfolio.
Post the quarter end, we achieved an important regulatory milestone upon receiving both the marketing and manufacturing licenses of our H9N2 avian influenza vaccine, a low patch AI vaccine. This further strengthens our poultry vaccine portfolio and positions us well for both domestic and export opportunities in India. The H9N2 opportunity is largely driven by the private commercial poultry market where disease preparedness, productivity and biosecurity are key priorities. Export markets will see a mix of institutional and private demand depending on how each country manages disease control. Manufacturing of H9N2 will be undertaken at our India plant only for now with the anticipated launch of the H9N2 vaccine, we also introduced an integrated avian influenza management approach and launched some health products in the previous quarter conceptualized by our technical team.
Rather than viewing AI purely through a vaccination lens, this approach addresses the broader on farm challenge addressing biosecurity, bird immunity and environmental management. This includes a range of solutions covering vaccination, probiotics and farm hygiene. I won’t get into the technical specifics here, but the objective is straightforward to deliver more consistent outcomes for farmers and create a more holistic solution led engagement model. Beyond H9N2, we continue to evaluate additional poultry pathogens and combinations across Newcastle disease, Burstle disease, Marek’s Disease, recombinant avian influenza platforms. Our approach here remains disciplined. We prioritize only those opportunities where regulatory clarity, manufacturing scalability and commercial viability align.
I would like to clarify that this is not intended to highlight any specific new R and D project, but rather reflects on our ongoing focus on strengthening our biological portfolio which remains Hester’s core area of expertise and long term competitive advantage. Speaking of the Animal Healthcare Division which includes the Ruminant and Pet Health segment, the Animal Health division recorded a 38% decline in Q3 and 40% over nine months in the financial year, primarily due to delays in government led immunization programs in the ruminant segment, particularly PPR and Gold Pox vaccine. It is important for me to reiterate that this is a timing delay, again, not a demand issue.
As we had also mentioned in the last quarter, execution under the National PPR Immunization Program and Gold Pox program to immunize against LSD is expected to commence from February 2026 and we anticipate improved momentum in the latter part of the financial year which is Q4. In addition to institutional delays the ruminant business was also impacted by some seasonal factors including lower incidence of clinical cases in farm animals. Feed supplement performance was also affected by higher feed costs and reduced cooperative milk prices which influenced purchasing behavior. Coming to the pet care segment, it continues to scale gradually and organically with steady traction across selected therapeutic and supplement products.
While still it is an early stage, pet care remains a strategic focus area for us. We are exploring pet vaccine opportunities for India as well as Africa using our existing facilities without any incremental capex. Also evaluating potential licensing opportunities as a part of a phased long term approach in pet care. A few development on the other operating income that you might have seen in the results. I would like to briefly clarify that a part of our other operating income during the period includes grant income linked to the development milestones under the GALVIT Supported VITAL program where we are working on a combined PPR VOTES vaccine.
This is a development focused collaboration where funding is released against clearly defined technical milestones. At this stage, the objective is to advance science and enable access rather than any near term commercialization. Any potential commercial pathway if at all, will be evaluated at a much later stage in alignment with the program objectives. An Update on the CAPEX and the Capacity as discussed earlier, some of you have asked about the status on our 182 crore capital work in progress during the quarter. I’m happy to share that we capitalized our fill finish facility effectively doubling our drug product capacity.
The remaining CWIP is expected to be capitalized over the coming months. R CAPEX has been structured in phases to support scale up across products and markets with returns expected to accrue progressively as the utilization increases. Coming on to our internal operations on a consolidated basis, the revenue grew by 22% in Q3 while nine months sales remained broadly stable. Profitability for nine month period improved substantially supported by operational discipline and better execution across subsidiaries in Africa. While Q3 was impacted by timing, delay in institutional order execution and higher operating costs, performance over nine months has remained positive.
The PPR eradication program in Africa are long term initiatives supported by multilateral funding. Hester continues to be prepared for as a global supplier and while demand visibility remains strong, execution is dependent on funding releases and country level rollout timeline. Overall, our Africa strategy has evolved from from opportunity led participation more to structured execution with sharper focus on working capital discipline and selective geographic exposure. I would like to add some context on our position in Africa. Hester today is one of the very few animal health companies in Africa with capabilities across multiple vaccine technologies. This technological depth allows us to respond to diverse disease profiles and regulatory expectations across the countries in the continent.
Our ongoing engagement with government and institutional stakeholders there indicates that animal healthcare remains a high priority area given its importance to food security and livelihoods. While the past couple of months saw elections and temporary disturbances in parts of the region, in Tanzania our engagement with authorities has remained active. In parallel, we have also registered products in the neighboring countries to widen our addressable markets. Speaking of Nepal operations, we are operating through challenging phase and are carefully evaluating operational and strategic measures to ensure stability and long term sustainability as we look ahead. The current year and particularly the last few quarters has been a period of consolidation, execution, improvement and capacity strengthening for us.
Our strategic priorities remain clear to reduce dependence on tender driven revenues and deepening our presence across commercial and export markets to leverage our expanded manufacturing capacity to support future growth to strengthen our poultry vaccine portfolio including avian influenza preparedness to continue investing in innovation with a long term disciplined approach Many of the questions we’ve received quarter after quarter relate to long cycle initiatives on CAPEX recombinant vaccines, government immunization programs. While quarter on quarter updates may appear less visible or measured, the underlying progress remains steady and aligned with long term roadmap and we remain confident that with the groundwork laid over the past few quarters, it will translate into stronger and more balanced performance going forward.
Thank you once again for continued trust. I did receive a few questions and I’ve tried answering them through my talk, but I’m now looking forward to taking any more questions. Thank you.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Madhur Rathi from Counter Cyclical Investments. Please go ahead.
Madhur Rathi
Thank you for the opportunity. I wanted to understand this 20 crore quarterly EBITDA that we are doing currently. Is this sustainable or we heard that there was a board view in Kerala during the month of November and December. Was this the poultry segment revenue jump because of that or can we expect these EBITDA numbers to be sustainable going forward?
Rajiv Gandhi
Yeah, Rajiv Gandhi the bird flew attack in Kerala has nothing to do with these numbers. Neither does it show a spurt in sales which has caused this profitability. As Priya mentioned in her talk that we are here at the moment trying to streamline, rationalize many activities in the plant and take a long term view. And the profitability forecasted is even higher than this. And we are determined to at the least keep this profitability.
Madhur Rathi
Got it. So going forward we can expect this 20 EBITDA number of upwards of 20.
Madhur Rathi
Garror.
Rajiv Gandhi
Being so specific is very not specific.
Madhur Rathi
But we can.
Madhur Rathi
We can expect to be on a higher trajectory. That would be a fair understanding.
Rajiv Gandhi
I think at the you can say that on a year on year basis we will be doing better. On a quarter to quarter basis such trajectory should not be measured. I think it’s the year on year definitely we will be on a higher trajectory.
Madhur Rathi
Got it. And so now we have mentioned capitalize our see the fill finished facility. So there has been no jump in our depreciation or so while that have we Commercial. Commercial. Is it in Q4 or Q3?
Unidentified Speaker
See, the depreciation will come into effect because it was just capitalized at the.
Unidentified Speaker
End of the Q3. You know the impact will come in this Q4 now.
Unidentified Speaker
So you might not see the impact because it is just capitalizing last quarter, you know Q3, the last days of the Q3.
Madhur Rathi
Got it. And sir, have we planned on how do we plan to scale up this new facility that has doubled our capacity? So what kind of products do we plan to launch or do we just plan to scale our existing product base and maybe Launch a few 1. So if you could just help us understand the scale up of this incremental volumes between our existing product and the new products.
Priya Gandhi
No. Hi. So I did mention in my talk about the existing products, the product mix as well as some products that we are trying to work, you know, which are a part of our developmental program. The additional CAPEX was obviously planned given the fact that how the growth numbers would be and how the revenue and the you know, the budgets will increase. And keeping that factor in mind is how the calculation had done. Which is why we had to invest in a capex. So that is all in line with that. To answer your question simply it will be right now to cater to the existing products.
Maybe we will look at more export markets that we will be able to fulfill through this increased capacity.
Madhur Rathi
So are we in discussion to supply to the some export market either via contract manufacturing route or maybe innovator LED manufacturing some something on that front?
Priya Gandhi
No, none of that at the moment. We want to retain our brand and we will be. You know, Hester will only be exporting these. Yes, the way it is going on.
Priya Gandhi
Right now
Madhur Rathi
Got it.
Madhur Rathi
That was from my end. Thank you so much and all the best.
Priya Gandhi
Thank you.
operator
Thank you. Participants, you are requested to limit your question to two per participant. The next question is from the line of Hershel Mehta from Zen Nivesh. Please go ahead.
Hershel Mehta
Hello. Am I audible?
operator
Yes.
Hershel Mehta
Yeah. So thank you for the opportunity. I just wanted to ask that recently that the result notification that we have released now in that.
operator
Yeah, he got disconnected. So we’ll move to the next participant. The next question is from the line of ravi Mehta from OneUp. Please go ahead.
ravi Mehta
Yeah, hi. Thanks for this opportunity. Just a couple of questions on the poultry side. What have you done structurally that. I’m seeing margins upwards of 20% consistently for last four quarters. You mentioned product mix in the opening remark. But what is structurally changing and how we should see these margins?
Rajiv Gandhi
Yeah, Rajiv here. This is all driven by the product mix that we choose and the profitability of the product. So it’s basically a mix of these two things. And that is what it is. We are conscious to improve the bottom line and therefore on a quarter to quarter basis we try to budget and try to push products wherein it impacts our profitability positively. It’s just. Yeah, I mean that’s the. This is a reaction of that action.
ravi Mehta
Okay. Because when we hear about product mix in many companies, it’s a, you know, phenomena of a quarter or two because ultimately baskets of product has to be sold to the markets and then the margin reverts. That’s why this question that, you know, when you are pivoting to a better product makes is this mix sustainable or there are low margin products which the market will require and you will have to, you know, supply at some point. So just wanted to get that clarity of how are you moving towards this mix?
Rajiv Gandhi
As I mentioned, it’s on a quarter to quarter basis. There are seasonal changes, everything that go into it. While our endeavor is to improve the margins, it cannot be guaranteed and assured that every product mix will yield an X margin. As I mentioned in the earlier to the earlier question, also look at it on a year on year basis rather than a quarter on quarter basis. On a year on year basis, we assure improvement of margin.
ravi Mehta
Sure, sure. No, that’s why refer to last four quarters together. It’s been a good journey. That’s why. Yeah, yeah, thanks. And we received this license of HN N2 recently. So how big this opportunity can be and how are you planning about, you know, scaling up this product in terms of any aspiration numbers, whatever you can talk.
Priya Gandhi
See, we get this question very often on the H9N2 opportunity in India and export. Very honestly speaking, it is very, very difficult to get one number and give it to you right now that this is the market size. It’s not as organized. Data is not as organized. All we can tell is it’s a very, very important disease and it is a cause of a lot of challenges in poultry. And you know, it is an upcoming market. It’s just recently got licensed here in India. So we have been getting these questions to give a number. But to be honest, unfortunately it’s very difficult to give any market size number at this point.
ravi Mehta
Okay, and in your animal health segment what I see is you alluded to the fact that these immunization drives are getting delayed. I just wanted some sense of how big is the pet care business within this segment. If you can give us some ballpark number on mix of the pet care.
Priya Gandhi
Segment is not participating in any immunization I have mentioned is only on the large animal, the ruminant, the dairy animal that’s you know, ppr, goat pox, vaccine is all in the ruminant section. So pet care has nothing to do with the national immunization and the pet care market. Again, you know, it varies. There is, you know, therapeutics, supplements, grooming accessory. It is a pet food. It’s a very, very big market. But our focus right now continues to be rather the objective with which we started was more on the technical and the therapeutic and the prescription based market.
Priya Gandhi
Right now,
ravi Mehta
no, my question was that if out of 91 crores of animal health revenue you did in nine months, what would be pet care? Because it gets clubbed into the segment or so how should we look at that segment?
Priya Gandhi
It’s under 5% of the animal health care number.
ravi Mehta
And that’s been steady. Like it’s been under 5 for last year or 24. It’s been that range.
Priya Gandhi
We’ve only started this two financial years ago. So it’s been two years. And yes, right now it’s been steady. We are in a very nascent stage as mentioned and we want to increase the share substantially.
ravi Mehta
Sure. And just one bookkeeping question was that Africa revenue is not mentioned in the press release. So if you can just help us with that number.
Priya Gandhi
The Africa number is mentioned in the press note. It is mentioned in the subjective part if you read under the consolidated numbers. So on page two it is mentioned consolidated financial highlights. And then in that there is Hester Africa and Hester Nepal. So if you see our revenue is just give me a minute.
ravi Mehta
Okay.
Unidentified Speaker
27.5 crores of revenue
Priya Gandhi
for the night for nine months.
Unidentified Speaker
Nine months.
ravi Mehta
Okay. 27 crores for nine months.
Priya Gandhi
Yes. Sorry, I just beg your pardon. I think in the consolidated result we’ve given a full number and in Nepal and Africa, I’ve mentioned on the profit and loss numbers. Yes, that’s what I have mentioned. But in the results that we have given, that has the breakup of the numbers.
ravi Mehta
Okay, I’ll check. I’ll come back. Thank you so much.
Priya Gandhi
Yeah, thank you.
operator
Thank you. The next question is from the line of Harshal Mehta from Zen Nivish. Please go ahead.
Hershel Mehta
Hello, Am I audible?
operator
Yes,
Hershel Mehta
yeah, sorry, got disconnected last time. So I just wanted to understand that in our notification we have mentioned that the company remains focused on building more balanced and resilience business by reducing the dependence on tender based revenues. So maybe if you can, you know, just brief us about what stage we are in this transformation and tentatively, if you can break it down into phases, you know, that will help us understand this whole process better.
Rajiv Gandhi
Yes, Rajiv. Yeah. This is an ongoing process. It is our endeavor. Now. Sometimes it may happen that we get very good tender business and that the tender business may again seem to be higher. But yes, over a long period of time we definitely would want to reduce the stress on the tender business. And that is going to happen over a period of time. And we are very conscious of that. So at the moment we are doing good in tenders. And even overall the market even is showing a little bit of a shift. Everybody in India does not necessarily wait for the tender market.
Now people, private enterprises, private dairy farms, of course in poultry, everybody uses independent of any tenders. It is shifting. So one is that the market is very slowly shifting. And two, we are increasing the market, increasing our reach directly to the dairy farms in India as well as in exports. We are aiming at supplying directly without the tender business. So this is our approach.
Hershel Mehta
Thank you so much, sir. So one more question on our poultry business only. So we understand that poultry business is mainly in a cyclical nature. So how long do you feel that this cycle, this time it can last? It would be somewhere in the rank of last time that we saw or you think this time it is something different in that manner.
Priya Gandhi
Sorry, are you referring to our performance or what exactly are you referring to?
Hershel Mehta
So we are seeing growth in on our poetry business side.
Hershel Mehta
Right,
Priya Gandhi
Right.
Hershel Mehta
So I just wanted to understand that it is a site, this particular business is cyclical in nature. If I’m not wrong.
Priya Gandhi
The animal health, poultry, even human Health is all cyclic, right? It is seasonal. There are particular seasons in which human health will also require probably more, there will be more illnesses, etc. So yes, likewise like that in animal health, also in ruminants, typically monsoon, quarter two, quarter one is when the season is. And poultry, it is the other way around. It is Q3, Q4. So yes, these are very natural cycles. And that’s. That’s also probably what a part of it reflects in our performance. But apart from that, it is, it is. It is going to be a constant factor.
Hershel Mehta
Got it. So I just wanted to understand that just basis on basis of your wide experience in this particular segment. As in you feel that this cycle is going to last for, you know, longer duration. From here also.
Rajiv Gandhi
There is nothing I’m not understanding what cycle are you referring to? One is that our business is not just it is dependent on cycles, but it is not only dependent on cycles. And if you look at it, we have grown poultry business on a quarter to quarter basis, ducking all the cyclical issues. So it is which cycle you are referring to is not clear. We are here to grow our poultry business as well as the age business. That’s all that we can say.
Hershel Mehta
Thanks a lot, sir. It answers pretty well. Thank you, sir.
operator
Thank you. The next question is from the line of Arya Shah from Whitestone pms. Please go ahead.
Arya Shah
Hi, thanks for the opportunity.
Arya Shah
So I just had one question. The BSL3, we were going to repurpose it.
Arya Shah
So what will be the capacity addition.
Arya Shah
To the new facility?
Unidentified Speaker
The BSL3 facility which was originally created to manufacture the drug substance for the COVID vaccine has now we have got the repurpose thing, the ability to repurpose for veterinary vaccines. We are evaluating this situation and we will convert it into an animal vaccine facility. We have yet to pin down on what exactly we would be doing over there.
Arya Shah
Okay, thank you.
operator
Thank you. As there are no further questions from the participants, I now hand the conference over to the management for closing comments.
Priya Gandhi
Thank you all for joining us and hearing us out. We do try our best to answer as many questions. A lot of the questions today were on whether we will be able to sustain the growth that we started showing specifically in poultry healthcare. And of course as management, that will anyway be our endeavor. So whether it is our ebitda, which is the trend which is showing, or a growing poultry division, you know, of course the straight answer and the feeling is that yes, this is the base and we want to continue with our efforts to grow this substantially and yes, take things forward and, you know, meet everyone’s expectations.
And thank you all for your continued support.
operator
On behalf of ICICI securities limited that concludes this conference. Thank you for joining us. And you may now now disconnect your lines.