Alkem Laboratories (ALKEM) Q1 26/27 earnings summary

Executive summary

• Revenue from operations reached ₹37,402 million in Q1 FY27, up 10.9% year-over-year, with India sales at ₹24,978 million (10.3% growth) and international sales at ₹12,224 million (16% growth).

• EBITDA margin stood at 20.5%, with EBITDA at ₹7,661 million, up 3.7% year-over-year.

• Net profit declined 21.7% year-over-year to ₹5,200 million, mainly due to higher taxation.

• Outperformed the Indian pharmaceutical market (IPM) in both acute and chronic segments, with notable growth in key therapy areas.

• Maintained focus on operational efficiency, disciplined capital allocation, and risk management amid a dynamic environment.

Financial highlights

• Profit before tax grew 1.8% year-over-year; R&D expenses were 4% of total revenue.

• Gross profit margin improved to 67.9% (up from 65.3% YoY), with gross profit at ₹25,389 million.

• Acute segment grew 12.3% (vs. IPM 10.1%), chronic segment 17.9% (vs. IPM 15.4%).

• EPS decreased 21.7% YoY to ₹43.5.

• Key therapy areas outperformed market: anti-infectives (1.1x), gastro (1.2x), vitamins/minerals (1.4x), pain (1.8x), anti-diabetic (1.4x), respiratory (1.6x), derma (1.6x).

Outlook and guidance

• India business expected to grow close to 12% for the year, with branded formulations leading and trade generics recovering.

• U.S. business guidance maintained at high single-digit to mid single-digit growth, supported by currency.

• CDMO U.S. business not expected to break even in the next 12 months; breakeven requires $25-30 million annual revenue, targeted for FY 2028.

• Occlutech integration underway, targeting ₹4,000 million sales and break-even EBITDA for FY 2027.

• Continued focus on outperforming the market in key therapy areas and ongoing R&D investment.