Alkem Laboratories (ALKEM) investor relations material

Executive summary

• Q1 FY27 revenue from operations was ₹37,401.5 million, up 10.9% YoY; India and international sales grew 10.3% and 16%, respectively.

• EBITDA rose 3.7% YoY to ₹7,661 million, with a 20.5% margin; PAT was ₹5,209.8 million, down YoY.

• Domestic business outperformed IPM in key therapy areas; Daman’s OAI status is a regulatory concern, though approved-product shipments continued uninterrupted.

• Capital allocation focused on core growth, operational efficiency and selective investment.

Financial highlights

• Revenue from operations grew 10.9% YoY and 3.8% sequentially; gross profit rose 15.4% YoY to ₹25,389 million.

• EBITDA margin was 20.5%, versus 21.9% YoY; PBT was ₹7,719.9 million, up from ₹7,580.8 million YoY.

• Gross margin was 67.9%, supported by sales mix and currency; higher API prices are expected to pressure subsequent quarters, with balance-of-year guidance at 66.5%-67%.

• R&D spend was ₹1,502 million, or 4.0% of sales; employee costs rose more than 16%, reflecting increments, ~1,200 additional medical representatives and Enzene staffing.

• Net profit was ₹5,209.8 million, versus ₹6,679.1 million in Q1 FY26; tax effects contributed to the decline.

Outlook and guidance

• FY27 U.S. sales outlook is mid- to high-single-digit growth, supported by currency; Daman is not expected to affect FY27 business.

• India business could approach 12% growth in FY27, potentially exceeding prior guidance by 100 bps.

• U.S. CDMO is not expected to break even within 12 months; annualized revenue of $25m-$30m is required, with that run rate expected in FY28.

• Occlutech FY target is INR 400 crore sales over ~8.5 months with break-even EBITDA; integration delays put prior guidance behind plan, with gradual margin improvement targeted over 3-4 years.

• Management continues to focus on outperforming the market in key therapy areas and investing in R&D.