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Price erosion in US generics
View Risks →Alkem Laboratories Limited — Q2 FY26
Alkem delivered a strong Q2 FY26 with revenue of ₹4,010 crore (+17.2% YoY), driven by robust growth across India (+12.4%), US (+28%), and non-US markets (+32.4%).
bullish
high
Financial stats pending filing verification
2-Minute Summary
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Alkem delivered a strong Q2 FY26 with revenue of ₹4,010 crore (+17.2% YoY), driven by robust growth across India (+12.4%), US (+28%), and non-US markets (+32.4%). EBITDA margin improved to 23% (+22.3% YoY), aided by operating leverage and better gross margins. PAT grew 11.1% to ₹765 crore. Management reiterated India outperformance of 100-150 bps over IPM and guided for full-year EBITDA margin of 19.5-20%, despite H2 headwinds from US CDMO opex (~₹50-60 cr/quarter) and GST impact (~₹50-60 cr in H2). New launches, especially Sacubitril in the US, are driving growth. Key risk: price erosion in US generics could pressure margins.
अल्केम की दूसरी तिमाही (Q2 FY26) में कमाई ₹4,010 करोड़ रही, जो पिछले साल से 17.2% ज़्यादा है। भारत (+12.4%), अमेरिका (+28%) और दूसरे देशों (+32.4%) में बिक्री बढ़ने से यह हुआ। कंपनी का मुनाफा (EBITDA) 23% रहा, जो पिछले साल से 22.3% बेहतर है। इसकी वजह कम खर्च और बेहतर कमाई है। शुद्ध मुनाफा (PAT) 11.1% बढ़कर ₹765 करोड़ हुआ। कंपनी का कहना है कि भारत में उसकी बिक्री बाजार से 1-1.5% ज़्यादा बढ़ेगी। पूरे साल के लिए मुनाफा 19.5-20% रहने का अनुमान है, हालांकि दूसरी छमाही में अमेरिकी खर्च (₹50-60 करोड़ प्रति तिमाही) और GST (₹50-60 करोड़) से दबाव होगा। नए उत्पाद, खासकर अमेरिका में Sacubitril, से बिक्री बढ़ रही है। खतरा: अमेरिकी जेनेरिक दवाओं की कीमत गिरने से मुनाफा कम हो सकता है।
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Read Transcript →Quarter Snapshot
India Sales Growth
₹2,766 crore
+12.4% YoY
India business grew 12.4% YoY, outperforming IPM; Alkem became #1 in acute segment per IQVIA.
US Sales Growth
₹765 crore
+28% YoY
US sales boosted by Sacubitril launch; full-year US growth guided to low double digits.
Non-US Sales Growth
₹424 crore
+32.4% YoY
Non-US markets grew 32.4% YoY, driven by Germany and Australia; constant currency growth ~28%.
US CDMO Revenue Run-rate
₹20 crore/quarter
N/A (new)
US CDMO plant operational from Sep; targeting ₹300 cr annual revenue in 12-18 months.
What Changed vs Last Quarter
NEW
India business to outperform IPM by 100-150 bps
Management expects India growth to continue at double-digit, outperforming the IPM by 100-150 bps in H2 and FY27.
NEW
US CDMO plant to reach ₹300 cr annual revenue in 12-18 months
The US CDMO plant, operational from September, is expected to achieve an annual run-rate of ₹300 crore within 12-18 months.
UPDATED
Full-year EBITDA margin guidance of 19.5-20%
Despite H2 opex from US CDMO (~₹50-60 cr/quarter) and GST impact (~₹50-60 cr), management expects EBITDA margin of 19.5-20% for FY26.
UPDATED
R&D spend to be 4-5% of revenue for FY26
R&D expenses were 3.3% in H1; management expects full-year R&D to be within 4-5% due to phasing of filings in Q4.
DROPPED
Medtech business to break even by FY28
Medtech business expected to break even in FY28; FY26 and FY27 will see losses of ₹40-50 crore each.
DROPPED
Capex guidance of ₹750 crore for FY26
Capital expenditure for FY26 is guided at ₹750 crore, primarily for CDMO and biotech facilities.
NEW RISK
GST impact on margins
GST revision will reduce benefits from Sikkim facility, causing a ₹50-60 crore impact in H2, pressuring margins.
NEW RISK
US CDMO ramp-up and breakeven timeline
CDMO plant opex of ₹50 cr/quarter with only ₹20 cr revenue initially; breakeven expected in 12-18 months, but delays could weigh on profitability.
NEW RISK
Penicillin G MIP uncertainty
Government may impose minimum import price on Penicillin G; management declined to comment, citing speculation, but it could increase costs.
RISK GONE
US tariff uncertainty
Potential US tariffs on pharmaceutical imports could impact margins; management called it 'hypothetical' and declined to provide specific mitigation strategy.
RISK GONE
New business opex drag
CDMO and medtech businesses will incur significant opex (₹50-60 crore per quarter) in H2 FY26, delaying margin expansion.
RISK GONE
Seasonality and incentive costs
Employee costs rose 15% YoY due to higher incentives; management expects lower growth in subsequent quarters, but volatility remains.
Fast read
Guidance and risk preview
Management expects India growth to continue at double-digit, outperforming the IPM by 100-150 bps in H2 and FY27.
Sacubitril launch faces competitive pricing pressure; price erosion could impact US revenue growth in subsequent quarters.
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