Are Sai Life Sciences Ltd latest results good or bad?

Sai Life Sciences Ltd's latest financial results for Q3 FY26 reflect a significant operational turnaround, showcasing strong revenue growth and margin expansion. The company reported a net profit of ₹100.38 crores, which represents a year-on-year increase of 86.41%. Revenue for the quarter reached ₹556.46 crores, marking a 26.53% increase compared to the same period last year. This growth demonstrates robust demand for the company's contract research and manufacturing services. The operating margin, excluding other income, reached a record high of 33.76%, reflecting a substantial improvement from the previous year, driven by enhanced operational efficiency and scale advantages. Additionally, the profit after tax margin improved to 18.04%, indicating effective cost management and operational leverage. Quarter-on-quarter, the company also showed positive trends, with net profit climbing 19.73% from ₹83.84 crores in Q2 FY26, and revenue expanding by 3.53% from ₹537.47 crores. This marks the seventh consecutive quarter of profitability for Sai Life Sciences, following a challenging period in FY24. Despite these positive operational metrics, the company experienced an adjustment in its evaluation, reflecting the market's perception of its valuation relative to its financial performance. The price-to-earnings ratio stands at a high level compared to industry averages, which raises concerns about sustainability and future growth expectations. Overall, Sai Life Sciences Ltd's Q3 FY26 results indicate a strong operational performance with significant revenue and profit growth, alongside improved margins, while also highlighting the challenges posed by its current valuation in the market.