Here's exactly what happened.
Revenue up 21%. EBITDA up 38%. PAT up 81%. And in Q4 alone, profit after tax nearly tripled. Thyrocare — the diagnostic chain owned by PharmEasy's parent API Holdings — has turned a corner. Let's walk through the numbers.
Let's start with the one-line summary: Thyrocare grew faster in profits than in revenues in FY26, which is exactly what you want to see. That gap between revenue growth (21%) and profit growth (81%) is called operating leverage — and it's what every investor is looking for.
Here's the complete income statement, year on year:
| Particulars (INR Cr) | FY25 | FY26 | Change |
|---|---|---|---|
| Revenue from operations | 687.35 | 829.04 | +21% |
| Cost of materials consumed | 191.08 | 219.57 | +15% |
| Gross Margin | 496.27 | 609.47 | +23% |
| Employee benefit expenses | 107.07 | 120.24 | +12% |
| Other expenses | 177.88 | 211.24 | +19% |
| Normalised EBITDA | 210.06 | 279.86 | +33% |
| ESOP cost | 20.73 | 17.82 | -14% |
| Reported EBITDA | 189.33 | 262.04 | +38% |
| Profit After Tax (PAT) | 89.98 | 162.85 | +81% |
Notice how costs grew slower than revenues across the board. Materials grew 15% vs revenue's 21%. Employee costs grew 12%. Even other expenses — the broadest overhead bucket — grew 19%. Every cost line is running below the revenue growth rate. That's a healthy business.
ESOP surprise: ESOP cost actually fell — from INR 20.7 Cr to INR 17.8 Cr. This directly widened the gap between Reported EBITDA (+38%) and Normalised EBITDA (+33%). For FY27, guided ESOP cost is just INR 12.8 Cr — meaning INR 5 Cr of free PAT improvement is already locked in before any new revenue.
| Margin | FY25 | FY26 | Change |
|---|---|---|---|
| Gross Margin % | 72% | 74% | +200 bps |
| Normalised EBITDA % | 31% | 34% | +300 bps |
| Reported EBITDA % | 28% | 32% | +400 bps |
| PAT % | 13% | 20% | +700 bps |
PAT margin going from 13% to 20% in a single year is genuinely significant. A 700 basis point margin improvement in one year is the kind of thing you see maybe once in a company's lifecycle. Some of it is exceptional-item cleanup (FY25 had a INR 11.16 Cr write-off), but even stripping that out, the underlying improvement is strong.
| Segment (INR Cr) | FY25 | FY26 | Growth |
|---|---|---|---|
| Standalone Revenue | 634 | 774 | +22% |
| Franchisee Revenue | 405 | 477 | +18% |
| Partnership Revenue | 192 | 254 | +32% ★ |
| Consolidated Revenue | 687 | 829 | +21% |
Partnership revenue — Thyrocare's B2B channel (hospitals, health-tech companies, corporate wellness) — is the fastest-growing segment at +32%. B2B contracts tend to be stickier, higher-volume, and more predictable than walk-in retail diagnostics.
| Metric | FY25 | FY26 | Change |
|---|---|---|---|
| Patients served | 16.7 Mn | 19.2 Mn | +15% |
| Tests conducted | 170.4 Mn | 209.6 Mn | +23% |
| Test menu offerings | 917 | 1,275 | +39% |
| Branded franchisees | ~1,200 | ~1,350 | +13% |
| Complaints per Mn tests | 7.1 | 3.5 | -51% |
Tests growing faster than patients (23% vs 15%) means more tests per patient — higher realisation per visit, better revenue quality. A 39% expansion in test menu creates the conditions for premium-priced specialty diagnostics to take a bigger share.
If the full year was strong, Q4 was spectacular — especially on the bottom line.
| Particulars (INR Cr) | Q4FY25 | Q4FY26 | YoY |
|---|---|---|---|
| Revenue | 187.16 | 223.95 | +20% |
| Cost of materials | 49.47 | 56.68 | +15% |
| Gross Margin | 137.69 | 167.27 | +21% |
| Employee expenses | 25.88 | 32.64 | +26% |
| Other expenses | 46.22 | 55.83 | +21% |
| Normalised EBITDA | 65.29 | 78.52 | +20% |
| ESOP cost | 7.90 | 3.43 | -57% |
| Reported EBITDA | 57.39 | 75.09 | +31% |
| PAT | 21.34 | 48.70 | +128% |
The 128% PAT growth has a technical explanation: Q4FY25 had a INR 11.16 Cr exceptional write-off that hit profit hard. Remove that, and Q4FY26 PAT growth is ~50% on a like-for-like basis — which is still very strong, but a more honest number to anchor on.
Run-rate check: Q4FY26 PAT of INR 48.7 Cr, annualised, implies ~INR 195 Cr PAT for FY27 — before any revenue growth. Full-year FY26 PAT was INR 163 Cr. The exit-quarter run rate is already 20% ahead.
| Margin | Q4FY25 | Q4FY26 | Change |
|---|---|---|---|
| Gross Margin % | 74% | 75% | +100 bps |
| Normalised EBITDA % | 35% | 35% | Flat |
| Reported EBITDA % | 31% | 34% | +300 bps |
| PAT % | 11% | 22% | +1,100 bps |
Normalised EBITDA margin was flat at 35% — meaning underlying business efficiency didn't slip, but didn't expand dramatically in Q4 either. The 300 bps reported EBITDA expansion came almost entirely from lower ESOP costs. The PAT margin near-doubling from 11% to 22% reflects both the ESOP drop and the absence of exceptional items.
Note on Q3FY26: Standalone Q3FY26 quarterly data was not included in the investor presentation shared. Full-year FY26 (INR 829 Cr) minus Q4FY26 (INR 224 Cr) implies Q1+Q2+Q3 combined revenue of INR 605 Cr. A granular QoQ bridge would require individual quarterly breakdowns.
| Item (INR Cr) | Mar 2025 | Mar 2026 | Change |
|---|---|---|---|
| Total assets | 692.75 | 747.22 | +7.9% |
| Cash & equivalents | 17.68 | 38.32 | +117% |
| Investments (current) | 137.36 | 151.50 | +10% |
| Trade receivables | 73.00 | 73.88 | Flat |
| Total equity | 547.05 | 586.02 | +7.1% |
| Equity share capital | 52.99 | 159.17 | ~3x jump* |
| Total borrowings | Nil | Nil | Debt-free |
| Total liabilities | 145.70 | 161.20 | +11% |
* Equity share capital tripled from INR 53 Cr to INR 159 Cr — typically indicates a bonus share issue or corporate restructuring action during the year.
Trade receivables being flat despite 21% revenue growth is a genuine quality signal — you're collecting faster relative to a bigger business. That's collection efficiency improving.
| Item (INR Cr) | FY25 | FY26 | Change |
|---|---|---|---|
| Operating cash flow | 179.91 | 213.24 | +19% |
| Capex (PPE + intangibles) | (33.48) | (20.88) | -38% lighter |
| Free cash flow (approx.) | ~146 | ~192 | +32% |
| Dividend paid | (95.31) | (148.43) | +56% |
| Net increase in cash | 8.38 | 20.64 | +146% |
Operating cash flow of INR 213 Cr against PAT of INR 163 Cr implies a cash conversion ratio of ~131% — the business generates more actual cash than its reported profit. Capex fell 38% YoY, suggesting the heavy lab infrastructure build-out is tapering. Despite paying out INR 148 Cr in dividends — up 56% — cash balances still doubled.
| What happened | Why it matters |
|---|---|
| Revenue +21%, costs grew slower | Operating leverage is structurally intact |
| Partnership revenue +32% | B2B channel growing fastest — stickier, higher volume |
| PAT +81% full year, +128% in Q4 | Profit inflection has arrived — run-rate is even stronger |
| ESOP costs declining (FY27 guided: INR 12.8 Cr) | PAT will grow even if revenue doesn't accelerate |
| Debt-free, FCF ~INR 192 Cr, dividend up 56% | Cash machine. No dilution risk. |
Data sourced from Thyrocare Technologies Limited (TTL) Q4FY26 & FY26 investor presentation. TTL is a subsidiary of API Holdings Limited (PharmEasy). All figures in INR Crore. FY = April to March financial year. This document is for informational purposes only and does not constitute investment advice.