Akums Drugs & Pharma , a leading Indian contract development and manufacturing company, has taken a significant step towards expanding its presence in Africa. The company executed a Framework Agreement with the Government of the Republic of Zambia on August 22, 2025, to establish a local manufacturing facility in the country.

Key Highlights of the Agreement

• Joint Venture Structure: The project will be implemented through a joint venture company in Zambia, with Akums holding a 51% majority stake and a Zambian state instrumentality owning the remaining 49%.

• Manufacturing Commencement: The facility is expected to begin operations in 2028, focusing on the production of general oral solids, liquids, injectables, and beta-lactam products.

• Interim Supply Agreement: Until the facility becomes operational, the Government of Zambia will purchase medicines worth a minimum of USD 50.00 million over two years (2026-2027) at USD 25.00 million annually from Akums' facilities in India.

• Joint Venture Timeline: The joint venture is expected to be established before the end of 2025.

Strategic Objectives

The collaboration aims to achieve several strategic objectives:

1. Support Zambian national health programs
2. Enhance local production capabilities in Zambia
3. Potentially export to neighboring African countries, including Zimbabwe, Namibia, Botswana, Malawi, Tanzania, and Mozambique

Technology Transfer

Akums has agreed to provide its proprietary technology, know-how, and technical expertise to the joint venture through a separate Technology Transfer Agreement, which is expected to be signed by the end of September 2025.

Market Expansion

This move represents a significant opportunity for Akums to expand its business in African countries and capture a sizeable market share. The company's expertise in pharmaceutical innovation and excellence is expected to contribute to improving healthcare infrastructure in Zambia and potentially in the broader region.

Regulatory Compliance

The agreement has been disclosed in compliance with Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) 2015.

This strategic partnership between Akums Drugs and the Zambian government marks a significant step towards enhancing pharmaceutical manufacturing capabilities in Africa and improving access to essential medicines in the region.

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.