Alkem Laboratories (ALKEM) Q1 24/25 earnings summary

Executive summary

• EBITDA margin rose to 20.1% in Q1 FY25 from 13.1% in Q1 FY24, driven by product mix, cost control, and favorable API pricing; EBITDA up 56.4% YoY.

• Net profit after minority interest surged 90.1% YoY to ₹5,452 million.

• Domestic business remains strong, focusing on large brands and portfolio expansion; international and emerging markets targeted for growth.

• Successfully resolved USFDA Form 483 at Baddi facility, reinforcing regulatory compliance.

• Standalone and consolidated unaudited financial results for Q1 FY25 were reviewed and approved, with auditors issuing unmodified review reports.

Financial highlights

• Consolidated revenue from operations was ₹30,318.2 million, up 2.2% YoY.

• Net profit after minority interest for Q1 FY25 was INR 545 crore.

• Gross profit increased 10.6% YoY to ₹19,559 million, with gross margin rising to 64.5%.

• EPS for Q1FY25 was ₹45.60, up 90.1% YoY.

• R&D expenses were ₹1,257 million, 4.1% of revenue.

Outlook and guidance

• EBITDA margin guidance for FY25 maintained at around 18%, with gross margin expected at 62%-62.5%.

• R&D spend projected at 4.5%-5% of sales for FY25, with higher spend in Q3 and Q4.

• India business expected to grow in line with the market, estimated at 8%-10%.

• Continued focus on product launches and regulatory approvals in the US and other international markets.

• Non-U.S. international business expected to grow at mid-teens rate over the next 2-3 years.