Q2 FY27 results analysis · November 12, 2026
Alkem Laboratories Ltd Q2 FY27 Results Analysis: Revenue Jumps 13.77%, PAT Slips on Tax Step-Up
−11.7%PAT year on year, Rs. 675.34 Cr
Source: Quarterly results filing (BSE)
Quick summary
Alkem Laboratories Ltd's Q2 FY27 numbers came in strong, with revenue of Rs. 4,551.99 Cr (+13.77% YoY) and PAT growth of -11.73% YoY. Here's a quick read of what worked, what to watch, and what management said.
Quick Details
| Results date | November 12, 2026 |
|---|---|
| Revenue (Q2) | Rs. 4,551.99 Cr (+13.77% YoY) |
| PAT (Q2) | Rs. 675.34 Cr (-11.73% YoY) |
| EBITDA margin | 22.52% (-49 bps YoY) |
| EPS (Q2) | Rs. 56.48 (-11.74% YoY) |
Quarter Snapshot
Q2 revenue grew 13.77% YoY with EBITDA margin of 22.52% above the FY27 guided 20-21% band, and the core Pharmaceuticals segment delivered 11.77% growth with EBIT margin up 277 bps. PAT to owners fell 11.73% on the disclosed tax-regime step-up (ETR 33.20% vs 12.97%) and Biotech/MedTech investment-phase losses of Rs.163.77 Cr combined. Occlutech's revenue pace is tracking ahead of the ~Rs.400 Cr guide, though its EBITDA-breakeven target is not yet met, leaving H2 margin headroom substantial.
Q2 FY27 Expectations vs Results
| Driver | What happened | Verdict |
|---|---|---|
| Revenue "in-line to ahead on a tough base" | Revenue +13.77% YoY (incl. Occlutech) | Played out |
| Margin "compressing vs the 23.0% base; 20–21% guide the line to defend" | 22.52%, −49 bps YoY, above the band | Played out |
| "The tax line is the other swing… the 30–32% guide needs reconciling" | ETR 33.20% (H1 32.87%) vs 12.97% — Q2 above band top | Played out |
| Gross margin pressed by API costs vs 66.5–67% floor | 67.16% — held | Played out |
| Occlutech run-rate vs ~Rs.400 Cr guide; guarantee in the notes | Rs.133.14 Cr in ~2.5 months (pace ~Rs.452.7 Cr); EBIT (Rs.49.63) Cr; guarantee not in the filing | Partially |
| Trade-generics recovery test; US volume/currency; Daman update; MIP renewal | Not addressed in the filing | Not observable |
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Management Guidance vs Delivery
| What management said | Where | What happened | Verdict |
|---|---|---|---|
| FY27 EBITDA margin 20–21% | Q4 FY26 earnings call | Q2 22.52%; H1 21.60% — above the band | On Track |
| ≥1% YoY margin improvement, FY27 onwards | Q2 FY26 earnings call ("from subsequent years, we should look at least a 1% improvement in our overall margin") | Q2 −49 bps; H1 −91 bps YoY — Q2/H1 print | Missed |
| Consolidated ETR 30–32% | Q1 FY27 earnings call (revised from 35–38%) | Q2 33.20%; H1 32.87% | H1 within band; Q2 marginally above top end |
| Gross margin 66.5–67% (balance of FY27) | Q1 FY27 earnings call | Q2 67.16% | Met |
| Occlutech ~Rs.400 Cr sales (8.5 months), breakeven EBITDA | Q1 FY27 earnings call (already flagged "a bit off from the guidance which was last said") | Revenue pace ~Rs.452.7 Cr; MedTech EBIT (Rs.49.63) Cr | Revenue on track; EBITDA breakeven not yet delivered |
| Occlutech close within 45–60 days, contributions beginning Q2 FY27 | Q4 FY26 earnings call, per prior-quarter analyst notes | Closed 16 July 2026 per the filing; MedTech revenue of Rs.133.14 Cr booked in Q2 | Confirmed |
| Trade-generics recovery "in upcoming quarters" | Q1 FY27 earnings call, per prior-quarter analyst notes | No product/geography split in the filing | Too Early |
| Daman OAI: "no business impact this year" | Q1 FY27 earnings call, per prior-quarter analyst notes | No regulatory commentary in the filing; Pharma segment revenue +11.77% YoY with margin up 277 bps shows no observable disruption | Too Early |
Key Investment Insights
Key Positives
- Consolidated revenue grew 13.77% YoY to Rs.4,551.99 Cr and 21.71% QoQ against the toughest base of FY26
- EBITDA margin of 22.52% came in above the FY27 guided band of 20-21% (H1: 21.60%)
- Pharmaceuticals segment revenue grew 11.77% YoY with EBIT margin up 277 bps to 24.19%
- Gross margin held at 67.16%, above the guided 66.5-67% floor despite API-cost concerns
- Occlutech revenue pace of ~Rs.452.7 Cr annualized (8.5 months) tracks ahead of the ~Rs.400 Cr sales guide
- Standalone continuing-operations revenue grew 20.82% YoY with a 32.28% EBITDA margin
- H1 CFO of Rs.10,445.8 Cr gave CFO/PAT of 0.88x and FCF of Rs.723.69 Cr; working-capital drag moderated to Rs.475.91 Cr from Rs.642.74 Cr
- H1 EBITDA margin of 21.60% implies only an 18.40% H2 margin is needed to hold 20% for the full year
Risk Factors
- PAT attributable to owners fell 11.73% YoY (normalized −17.37%) as the effective tax rate stepped up to 33.20% from 12.97% under the new tax regime (cash tax rate 40.55%)
- Biotech swung from ~breakeven to a Rs.114.14 Cr EBIT loss on the Enzene CDMO ramp
- MedTech posted a Rs.49.63 Cr EBIT loss, with the Occlutech EBITDA-breakeven guide not yet delivered
- Subsidiaries were a net drag of Rs.87.14 Cr on the parent (consolidated PAT Rs.675.34 Cr vs standalone Rs.762.48 Cr)
- Employee costs grew 26.23% YoY and finance costs 64.68% YoY, both outpacing revenue
- Q2 ETR of 33.20% was marginally above the guided 30-32% band top
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