SEARL Profit Up 9% In 2QFY26

The Searle Company Ltd (SEARL) announced its 2QFY26 financial results, posting an unconsolidated quarterly profit of Rs931mn (EPS: Rs1.58), up 9% QoQ.

The effective tax rate (ETR) stood at 58% in 2QFY26, mainly due to a one-off tax provisioning of approximately Rs273mn related to super tax, as per channel checks.

This brings 1HFY26 profits to Rs1.8bn (EPS: Rs3.03), compared to a loss of Rs39mn (LPS: Rs0.07) in the same period last year.Net sales increased 39% YoY and 5% QoQ to Rs9bn in 2QFY26. For 1HFY26, revenue surged 34% YoY to Rs17.5bn, driven by higher volumes and improved pricing.

Gross margins strengthened to 56.7% in 2QFY26, compared to 52.6% in the same period last year and 55.9% in 1QFY26.

This takes 1HFY26 margins to 56.3%, up from 49.2% in 1HFY25.Distribution expenses rose 32% YoY but declined 6% QoQ to Rs2.5bn in 2QFY26.Administrative expenses reached Rs456mn, increasing 8% YoY and 10% QoQ. For 1HFY26, admin expenses stood at Rs870mn, up 14% YoY.

Other income came in at Rs250mn, rising 6.8x YoY and 6.9x QoQ, primarily driven by unwinding gains on proceeds from assets sold under Ijarah arrangements. The income is being recognized gradually over the tenure of the underlying financial obligations, supporting overall earnings.

Finance costs declined sharply to Rs241mn, down 62% YoY and 14% QoQ due to lower borrowings. For 1HFY26, finance costs stood at Rs520mn, down 62% YoY compared to Rs1.4bn in 1HFY25.SEARL is currently trading at an FY26E P/E of 14.8x.