Entero Healthcare Solutions Ltd (NSE:ENTERO) Q3 2026 Earnings Call Highlights: Strong Revenue …

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Mon, February 16, 2026 at 10:01 AM GMT+9 3 min read

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Release Date: February 13, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Entero Healthcare Solutions Ltd (NSE:ENTERO) reported a strong quarter with a 26% year-on-year revenue growth and a 9% quarter-on-quarter increase.

The company achieved the highest organic growth of 17.1% year-on-year, surpassing the industry growth rate of 12%.

Gross profit increased by 29% year-on-year, with gross margins improving by 30 basis points to 10.1%.

EBITDA for the quarter grew by 36% year-on-year, with margins improving by 30 basis points to 4%.

The company successfully closed several acquisitions, expanding its distribution reach and product segments, particularly in the Medtech segment.

Negative Points

The company faced an exceptional impact of a new labor code, affecting margins with a one-off cost of INR 6.1 crore.

Interest costs have increased significantly due to investments in acquisitions, despite improvements in working capital days.

The company has a negative cash flow from operations for the first nine months, requiring significant cash flow generation in Q4 to meet annual targets.

There is a need to integrate recent acquisitions, which may slow down further acquisition activities in the near term.

The company faces challenges in maintaining its EBITDA margin guidance, requiring a significant improvement in Q4 to meet the full-year target.

Q & A Highlights

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Q: Can you articulate your growth strategy in the medical device segment? How do you plan to accelerate growth here? A: (CEO) In the Medtech segment, growth can be accelerated through pan-India exclusive distribution deals with companies, as there are few specialized distributors in this space. Our existing infrastructure, including 130 warehouses and relationships with pharmaceutical companies, provides leverage to grow this business.

Q: Are you still holding on to the guidance of achieving a 4% EBITDA margin for the full year? A: (CEO) Yes, we are on track to deliver our full-year guidance, which includes achieving a 4% EBITDA margin. The focus will be on delivering strong results in Q4 to meet these targets.

Q: Why has your interest cost increased significantly despite improved working capital days? A: (CFO) The increase in interest cost is due to investments in acquisitions, which have utilized cash that was previously earning interest. IPO funds are almost fully used now.

La historia continúa  

Q: What is the impact of the new labor code on employee costs and margins? A: (CFO) The exceptional cost recognized is a one-time past service cost. Going forward, we do not expect the new labor code to materially affect our overall margins.

Q: What are the key factors behind the increase in other expenses? A: (CEO) The increase in other expenses is primarily due to higher costs associated with demand generation activities in the Medtech segment, which include higher manpower and marketing expenses. These activities also drive higher gross margins.

Q: What is your strategy for acquisitions going forward? A: (CEO) We have completed major acquisitions and will focus on integrating them over the next few quarters. We will stabilize operations, improve margins, and cash flows before considering new acquisitions.

Q: How do you see the impact of new trade deals with the US and EU on your business? A: (CEO) Our company is insulated from global trade deals as we focus on the domestic Indian market. We are more impacted by local consumption trends and healthcare developments in India.

Q: What are the levers behind your organic growth, and what is the sustainable growth rate for the business? A: (CEO) Our growth is driven by offering a large product portfolio and superior service levels to customers, which helps us gain wallet share and expand our customer base. We continuously expand our geographical reach and product offerings, reinforcing our business model.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

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