Alkem Laboratories Ltd Q4 FY26 Earnings Call: EBITDA Crosses Rs. 3,000 Crores, Domestic Double-Digit Growth Guided

Alkem Laboratories Ltd held its Q4 FY26 earnings call on May 28, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Record EBITDA and Broad-Based Full-Year Growth

• Total revenue from operations for FY26 of Rs.1,47,123 million— up 13.5% YoY; Q4 FY26 revenue of Rs.36,033 million, up 14.6% YoY.
• EBITDA for FY26 reached Rs.30,052 million— margin 20.4% vs 19.4% in FY25, growing 19.6% YoY. Management described FY26 as a landmark year with EBITDA crossing Rs.3,000 crores.
• Q4 FY26 EBITDA of Rs.5,174 million— margin 14.4% vs 12.4% in Q4 FY25, up 32.2% YoY.
• Net profit for Q4 FY26 of Rs.2,365 million— exceptional items included Rs.602.7 million gratuity/leave liability and Rs.747 million real estate impairment.
• R&D expenses for FY26 of Rs.6,173 million (4.2% of revenue)— vs Rs.5,620 million (4.3%) in FY25. Q4 FY26 R&D spiked to Rs.2,293 million (6.4% of revenue), partly reflecting Semaglutide launch costs.
• Near-term headwinds from geopolitical environment and supply chain— management cited increased logistics costs and pressure on APIs/packaging materials, with proactive inventory build-up to mitigate disruptions.

Domestic Formulations Outperform IPM Across Key Therapies

• India sales for FY26 grew 9.7% YoY to Rs.98,514 million— branded generic growth was ~10%; trade generic (TGX) grew 4.5% in FY26, impacted by restructuring, with the Adroit acquisition contributing incremental growth.
• According to IQVIA, Q4 FY26 India business grew 11.1% YoY vs IPM growth of ~10%— acute segment grew 10% vs IPM 7.7%; chronic segment grew 16.1% vs IPM 13.6%, delivering 250 bps outperformance.
• Outperformed in six focus therapies— GI, vitamins & minerals, pain, antidiabetic, respiratory, and dermatology.
• Domestic formulation MR count stands at ~14,500 (group level)— attrition at 18–19%, down from prior years and below industry average; recent field-force additions have targeted chronic therapy areas.
• Management guided domestic business double-digit growth for FY27— 100–250 bps above market, with the India branded generics (BGX) business expected to outperform IPM by 100–150 bps in FY26-27.
• Acute segment impacted by muted anti-infectives— nonetheless delivered high single-digit growth for Alkem in FY26, driven by A to Z, respiratory, and pain/analgesics.

US Guidance, Biosimilar Pipeline and New Launches

• US revenue growth guidance of high single-digit dollar-to-dollar for FY26-27— does not include CDMO business; additional tailwinds expected from forex gains and new product launches.
• Tolvaptan launch expected in the US in September/October FY26-27 (H2)— market with limited competition; expected to offset ongoing base business value erosion.
• Denosumab (Prolia) biosimilar under FDA approval— launch expected around Q1 FY2027-2028, but company lacks a sales basket and may consider out-licensing;launch within FY26-27 is uncertain.
• International sales for FY26 grew 22.5% YoY to Rs.46,810 million— ROW markets expected to sustain higher teens growth for FY27.
• Semaglutide US filing targeted in ~1.5 years— ROW market entry expected "a few quarters from now"; regulatory approval received for injectables in India; tablet clinical trial ongoing with future regulator submission planned.
• US base business faces ongoing value erosion— new launches like Tolvaptan expected to offset the decline; no specific US growth rate guidance provided beyond high single-digit dollar growth.

Biosimilars and CDMO Ramp-Up Still in Early Innings

• Enzene India at break-even or better in Q4 FY26— early double-digit teens EBITDA margin; Enzene US still ramping up and posting losses, so combined Enzene business was not EBITDA positive in Q4 FY26.
• Management guided total Enzene may be close to EBITDA positive in FY26-27— Enzene US will take more time to reach break-even.
• CDMO business reported under Inzene within US geography— revenue less than Rs.100 crores recognized from the US in FY25-26; management indicated it will take a couple of years to become meaningful (~Rs.200–300 crores).
• MedTech segment currently contributes <1% of revenue— Oclutech acquisition expected to close in 45–60 days (by Q2 FY27), after which its numbers will be consolidated.
• Tariff-driven insourcing at US Enzene biologics facility is "early days"— management stated that large pharmaceutical companies are building their own capacity and take time to decide; no meaningful improvement in asset turnover has occurred.
• Management committed to providing updates on Enzene and MedTech— including the recent Aquila Tech acquisition, in future presentations when there is meaningful progress.

Margin Trajectory with Supply Chain Headwinds

• Management guided overall corporate EBITDA margins in the 20–21% range for FY27— FY26 like-to-like margin touched 20.4%, providing a comparable baseline.
• Trade generic business profitability has improved— now "not very far" from corporate margins (FY27 target 20–21%), though segment-level margins are not separately disclosed.
• Near-term headwinds from geopolitical environment and supply chain dynamics— increased logistics costs and pressure on APIs/packaging materials; management is proactively managing supply chain with adequate inventory build-up to mitigate disruptions.
• Tax rate increased in FY26— details to be provided later.
• R&D intensity remained elevated in Q4 FY26 at 6.4% of revenue— full-year R&D of Rs.6,173 million (4.2% of revenue) reflects ongoing investment in Semaglutide, biosimilars, and the differentiated pipeline.
• US base business value erosion and CDMO gestation period— these factors create a drag on consolidated margins until new launches and Enzene scale-up reach critical mass.

CEO Transition, Semaglutide Launch and Portfolio Expansion

• CEO Dr. Vikas Gupta is leaving Alkem Laboratories— top-tier global headhunter engaged for CEO search; process will take "few months". Non-pharma group businesses (Oclutech, Enzene) will continue to report to promoters/MD, while CEO will oversee core pharma operations.
• Successful day-one launch of Semaglutide in India in March 2026— achieved ~11% market unit share in initial IQVIA data, with management expecting further increase.
• GLP-1 launched during FY26 and performing extremely well— management flagged Semaglutide injectables approval in India; tablet clinical trial ongoing; US filing targeted in ~1.5 years; ROW entry expected "a few quarters from now".
• MedTech and biosimilar bio-CDMOs identified as key growth areas— alongside the core domestic formulations business, these represent the medium-to-long-term strategic pillars.
• Outlook for FY27: sustain growth and profitability, improve portfolio mix, expand differentiated pipeline— management aims to maintain double-digit domestic growth and high single-digit US dollar growth while navigating supply chain pressures.
• CEO transition introduces execution uncertainty— the search process will span several months, and the separation of pharma vs non-pharma reporting lines creates a transitional management structure.