Alkem Laboratories Reports Strong Q2 Results with 17.2% Revenue Growth
Alkem Laboratories achieved record-breaking Q2 results with total revenue reaching INR 40,010.00 million, up 17.2% year-on-year. EBITDA grew 22.3% to INR 9,208.00 million, with a 23% margin. Net profit increased 11.1% to INR 7,651.00 million. The company showed strong performance across segments, with India sales up 12.4%, U.S. sales up 28%, and non-U.S. international sales up 32.4%. Alkem became the top player in India's acute segment and outperformed the market in several therapies. R&D expenses were 3.3% of total revenue. The U.S. business growth was driven by new product launches, including Sacubitril/valsartan. The company expects to maintain EBITDA margins between 19.5% to 20% for the full year and aims to outperform the Indian pharmaceutical market.
*this image is generated using AI for illustrative purposes only.
Alkem Laboratories , a leading Indian pharmaceutical company, has reported robust financial results for the second quarter, showcasing strong growth across its key markets.
Key Financial Highlights
- Total revenue from operations reached an all-time high of INR 40,010.00 million, marking a 17.2% year-on-year growth.
- EBITDA grew by 22.3% year-on-year to INR 9,208.00 million, resulting in an EBITDA margin of 23%.
- Net profit after minority interest stood at INR 7,651.00 million, representing an 11.1% year-on-year increase.
Market Performance
Alkem Laboratories demonstrated impressive performance across various segments:
| Segment | Sales (INR million) | Year-on-Year Growth |
|---|---|---|
| India | 27,660.00 | 12.4% |
| U.S. | 7,649.00 | 28.0% |
| Non-U.S. international | 4,241.00 | 32.4% |
Domestic Market Leadership
The company has achieved notable milestones in the Indian pharmaceutical market:
- Became the number one player in India's acute segment
- Outperformed the Indian Pharmaceutical Market (IPM) in 6 out of 11 therapies
- Demonstrated strong growth in key therapeutic areas:
- Anti-infectives: 1.2x market growth
- Gastrointestinal: 3.1x market growth
- Vitamins, Minerals, and Nutrients (VMN): 2.5x market growth
- Pain management: 2.3x market growth
- Respiratory: 1.5x market growth
- Dermatology: 3.1x market growth
R&D Investment and New Product Launches
Alkem Laboratories continues to focus on innovation and new product development:
- R&D expenses for the quarter were INR 1,302.00 million, representing 3.3% of total revenue
- The company ranks second in the IPM for new product launches in the last 12 months
U.S. Market Developments
The company's U.S. business saw significant growth, driven by new product launches:
- Sacubitril/valsartan launch contributed substantially to U.S. market growth
- Four new product launches in the first half of the fiscal year, with three to four more planned for the second half
- Expecting low double-digit growth (10-11%) in the U.S. market for the full fiscal year
Future Outlook
Alkem Laboratories remains optimistic about its future performance:
- Expects to maintain EBITDA margins between 19.5% to 20% for the full year
- Aims to continue outperforming the Indian pharmaceutical market by 100 to 150 basis points
- Focusing on maximizing output from its newly operational U.S. CDMO plant, with potential for further expansion based on market opportunities
Recent Regulatory Development
The company recently received a GST demand order from the Assistant Commissioner, Division-VIII, Ankleshwar, Central GST and Central Excise, Vadodara-II Commissionerate:
- The order demands GST of INR 180.87 million along with an equal amount as penalty for the period FY2018-2019 to FY2024-2025
- Alkem Laboratories does not agree with the demand order and plans to contest it
- The company states that there is no material impact on its financial, operational, or other activities
Alkem Laboratories' strong performance across key markets, coupled with its focus on innovation and market leadership, positions the company well for continued growth in the pharmaceutical sector. The management remains confident in its ability to navigate challenges and capitalize on emerging opportunities in both domestic and international markets.
Historical Stock Returns for Alkem Laboratories
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| +0.09% | -0.86% | +2.90% | +7.40% | +3.40% | +112.99% |
20
