Blue Jet Healthcare tanks 19% in 2 days; nears issue price; here's why

The company said decrease in revenue from operations during Q3FY26 is due to lower sales of PI and Artificial Sweeteners.

Blue Jet Healthcare share price today

 

Shares of Blue Jet Healthcare hit a 52-week low of ₹357.75, falling 10 per cent on the BSE in Monday's intraday trade. The stock extended its Friday's decline on the back of a disappointing set of earnings for the quarter ended December 2025 (Q3FY26).  In the past two trading days, Blue Jet Healthcare stock has tanked 19 per cent. It has fallen below its previous low of ₹393 touched on February 2, 2026. 

The stock price of the pharmaceutical company is quoting close to its initial public offering (IPO) issue price of ₹346 per share. The company made stock market debut on November 1, 2023. The stock had hit a record low of ₹319.40 on December 12, 2023. 

At 10:11 AM; Blue Jet Healthcare stock was quoting 9 per cent lower at ₹360.40, as compared to 0.21 per cent rise in the BSE Sensex.  CATCH STOCK MARKET UPDATES TODAY LIVE

Why did Blue Jet Healthcare's share price tank 19 per cent in 2 days?

 

Blue Jet Healthcare is a specialty pharmaceutical and healthcare ingredient and intermediate company, offering niche products with an approach of "Collaboration, Development, Manufacturing" to CDMO business. 

In Q3FY26, BlueJet's revenue dipped 39.6 cent year-on-year (Y-o-Y) to ₹1,924 crore on lower sales of bempedoic acid and weak performance in sweeteners.  

The company said the decrease in revenue from operations during Q3FY26 was due to lower sales of PI and Artificial Sweeteners. PI segment continue to witness Inventory challenges and de-stocking at customer end leading to deferment of orders of orders. 

Gross profit declined 42.8 per cent Y-o-Y to ₹99.6 crore, while gross profit margin dipped 290bp Y-o-Y/1,330bp Q-o-Q to 51.7 per cent due to three key factors – 1) destocking of inventory wherein COGS captured the operating cost; 2) lower prices for sweeteners and 3) higher APD prices as it has purchased higher quantity from a European supplier.  

Earnings before interest, taxes, depreciation and amortisation (Ebitda) contracted 62.2 per cent to ₹46.9 crore. Ebitda margin was down 1,460bps Y-o-Y to 24.4 per cent, hurt by lower gross profit margin and negative operating leverage from lower revenue. Net profit declined 59.4 per cent Y-o-Y to ₹40.2 crore.   ALSO READ | Apollo Pipes up 24% in Feb, aims to break 5-mth losing streak; hint charts

Brokerages on Blue Jet Healthcare

Blue Jet Healthcare's Q3FY26 print was marred by gross profit margin volatility due to inventory destocking and lower bempedoic acid revenue. The company remains confident of growth in contrast media with stabilisation of supplies for NCE molecule, and likely commercialisation of iodinated ABA HCL, according to analysts at ICICI Securities. 

The brokerage firm remains cautious on ramp-up and sustainability of intermediate supplies for bempedoic acid, while the company is confident of jump in volumes post destocking and reassessment of supply chain by innovators. Its efforts remain on track for Mahad/ Vizag investments, and future product pipelines. 

Given this, the brokerage has cut FY26-28E EPS by 12-22 per cent, and lower target price to ₹500 (from ₹750) with rollover of valuations to FY28E (from Sep’27E). It has cut P/E multiple to 25x (from 35x), but reiterated 'BUY' rating on the stock.  Those at Emkay Global Financial Services said Blue Jet's subdued performance in the pharma intermediate (PI) segment was anticipated. However, contrast media intermediate (CMI) sales remaining flat Y-o-Y, along with the sharp decline in sweetener sales seen in Q3, was a negative surprise.  "Even as we remain convinced about the end-market potential of Bempedoic Acid (other products in the PI pipeline are unlikely to be meaningful contributors in the near term), the slower pace of recovery in the CMI segment and the potential impact of an extended period of lull along with changes in the innovator's sourcing strategy in the PI business pose risks even to our revised

projections," it said. 

Despite gross margin reverting to normalised levels (50-55 per cent) after the volatility seen over the past 2 quarters, Ebitda margin is unlikely to revert to FY25 levels by FY28 even as we build in a 17 per cent topline CAGR and gross margin expansion over FY26-28E. Besides, we believe that the persistent topline-induced earnings volatility will continue to weigh on valuation multiples, it said.  Emkay Global has cut earnings estimates (by nearly 25 per cent) and target price to ₹400 from ₹600. It has maintained its 'Reduce' rating.  

That said, Blue Jet Healthcare has a diversified global footprint, exporting to over 50 countries, with long-standing customer relationships ranging from 4 to 26 years, and derives ~87 per cent of its revenue from international markets. The company is among the leading Indian manufacturers of contrast media intermediates with a portfolio of 20 commercialised molecules used across MRI, CT and X-ray diagnostics. It also manufactures Bempedoic Acid intermediates for a global innovator and produces high intensity sweeteners (saccharin), providing product-level diversification.  

The company's CDMO model further enhances customer stickiness by offering end-to-end support from lab-scale development to commercial supply. In-house R&D capabilities support complex multi-step chemistry, process optimisation and scalability, facilitating timely transition of new molecules from development to commercialization, according to CARE Ratings. 

The company has outlined a capex of ₹1,300 crore over the next 3–4 years towards capacity expansion, product development, backward integration and establishing an R&D centre. Although the capex is expected to be primarily funded through internal accruals, timely execution within the envisaged cost and achieving the planned capacity utilisation remain critical. Any delay in project commissioning, cost escalation, or slower ramp-up of volumes from the expanded capacities could weaken return indicators and cash flows. Accordingly, execution risk remains a key rating monitorable, the rating agency said in rationale.  ============================================  Disclaimer: View and outlook shared on the stock belong to the respective brokerages and are not endorsed by Business Standard. Readers discretion is advised.