Akums Drugs & Pharma , a leading contract development and manufacturing organization (CDMO), reported a robust performance in the first quarter, with significant growth in profitability despite modest revenue gains.

Financial Highlights

The company's total income for Q1 stood at Rs. 1,051.00 crores, representing a 2.40% increase year-over-year. More impressively, Akums achieved a substantial 19% year-over-year growth in reported EBITDA, which reached Rs. 156.00 crores. The EBITDA margin expanded by 208 basis points to 14.80% compared to the same quarter last year.

Segment Performance

CDMO Business

The CDMO segment, Akums' largest revenue contributor, generated Rs. 813.00 crores in Q1, growing 4% year-over-year. This growth was achieved despite a 2.50% impact from lower API prices. The segment maintained healthy EBITDA margins of 14.70%, driven by an improved product mix.

Domestic Branded Formulations

The domestic branded formulations business reported revenue of Rs. 107.00 crores, showing a 3.40% year-over-year growth. This segment is expected to track the Indian Pharmaceutical Market (IPM) growth for the full year.

International Branded Formulations

Revenue from international branded formulations reached Rs. 35.00 crores, growing 2.40% year-over-year. The company anticipates high-teen growth in this segment for the full year.

API and Trade Generics

The API business saw a revenue decline of 35% year-over-year to Rs. 45.00 crores, as the company focused on select high-margin molecules. The trade generics segment is undergoing rationalization, with revenue decreasing by 21% year-over-year to Rs. 23.00 crores.

European Expansion and R&D Progress

Akums made significant strides in its European expansion strategy:

1. Received its first European dossier approval for Rivaroxaban.
2. Filed its first dossier in Switzerland for a Dapagliflozin combination product.
3. Obtained ANVISA Brazil approval for injectable plant 3 and GMP Russia certification for hormone plant 4.
4. On track with the progress of a major European contract, with commercial supplies expected to begin from April 2027.

The company's R&D efforts continue to yield results, with 27 DCGI approvals received in Q1. Akums achieved the milestone of 1,000 cumulative DCGI approvals, strengthening its product portfolio.

Future Outlook

Management expects mid-single digit growth for the CDMO business, with margins projected to remain in the 14-15% range. The company is targeting $100 million in formulation exports over the next five years, leveraging its expanding international presence and approvals.

Akums' strong liquidity position, with a cash surplus of Rs. 1,518.00 crores, provides a robust foundation for strategic growth initiatives, including potential inorganic opportunities in new dosage forms and market access.

As Akums Drugs & Pharmaceuticals continues to navigate challenges in API pricing and industry volume growth, its focus on product mix improvement, cost optimization, and international expansion positions the company for sustained growth in the coming years.

Akums Drugs & Pharma , India's largest contract development and manufacturing organization (CDMO), has reported strong financial performance for the first quarter, with significant growth in profitability and key operational milestones.

Financial Highlights

• Total income stood at ₹1,051.00 crore
• Adjusted EBITDA reached ₹156.00 crore, reflecting a robust 19.10% year-on-year growth
• EBITDA margins improved to 14.80% from 12.70% in the previous year, a 210 basis points improvement
• The company achieved a cash surplus of ₹1,518.00 crore, bolstered by a €100 million advance payment for its European contract

Operational Achievements

Akums Drugs & Pharma reached a significant milestone by securing 1,000 Drug Controller General of India (DCGI) approvals, with 27 new approvals added during the quarter. This achievement strengthens the company's product portfolio and enhances its competitive edge in the pharmaceutical market.

Segment Performance

The trade generics and API segments continued to face operational losses, though the company reports these losses are gradually reducing.

Strategic Developments

Akums Drugs & Pharma made significant strides in its global expansion strategy:

1. Received its first European dossier approval for Rivaroxaban
2. Filed its first dossier for Dapagliflozin combination in Switzerland
3. On track to commence commercial supplies for the European contract from April 2027

Management Commentary

Mr. Sanjeev Jain, Managing Director, stated, "This date marks just over one year since we got listed. We continue to work towards strengthening the organization with a focus on long-term growth. Our commitment to becoming a global CDMO player remains steadfast."

Mr. Sandeep Jain, Managing Director, added, "We continue to deliver strong performance despite the industry headwinds of decreasing API prices and muted volume growth. With a sustained focus on R&D, we have been able to deliver robust growth. Achieving 1,000 DCGI approvals is a key milestone that sets Akums apart from its peers, allowing us to offer margin-accretive differentiated offerings."

Future Outlook

The management expressed confidence in the company's future prospects, citing a strong pipeline and prudent capital allocation. They remain focused on strengthening Akums Drugs & Pharma's CDMO leadership, scaling high-value capabilities, and driving operational excellence to deliver sustainable and profitable growth in the years ahead.

Akums Drugs & Pharma continues to demonstrate resilience and growth in a challenging market environment, leveraging its strong R&D capabilities and strategic initiatives to maintain its position as a leading player in the Indian pharmaceutical industry.