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Informist, Thursday, May 28, 2026

--CONTEXT: Comments by Alkem Lab's mgmt in post-earnings analyst concall 

--Alkem Lab: Bullish on growth in semaglutide business in India in FY27 

--Alkem Lab: See Q1 financial performance impacted due to cost pressure 

--Alkem Lab: Do not foresee any major acquisitions for next 12 months 

--Alkem Lab: Aim generics business margins to improve in FY27 

--Alkem Lab: R&D expenses to be 4-5% of revenue in FY27 

--Alkem Lab: Aiming high single-digit growth in US in FY27 

By Ruchira Kagita and Avishek Rakshit

MUMBAI/KOLKATA – The management of Alkem Laboratories Ltd. expects its domestic and US businesses to grow at a healthy pace in 2026-27 (Apr-Mar). The domestic market is a top priority with growth expected from GLP-1 (Glucagon-like peptide-1) and semaglutide, the company said. The India business will continue to outperform the market by 100–150 basis points, the company's management told analysts at a post-earnings conference call. The company will continue to focus on margin improvements in its generics segment, they said. 

Semaglutide is expected to drive growth in the chronic division and the broader Indian market. The management said that, as per the latest IQVIA report, Alkem Laboratories had a unit market share of 11% in the semaglutide segment. The company had launched the drug in injectable dosage earlier in March. Alkem Laboratories expects its market share to rise further in the months ahead. 

The management also expects the company's trade generics business to improve in FY27. The focus in this segment was on profitability. In FY26, trade generics grew around 4.3%, they said.   

The company's target for its earnings before interest, taxes, depreciation, and amortisation margin in FY27 is a "moving goalpost," a senior official said, given global supply disruptions from the war in West Asia. The EBITDA margin is expected to be in line with the company's FY26 level but is not expected to exceed 20-21% in FY27. Alkem Laboratories had posted an EBITDA margin of 20.4% for FY26.

On the war in West Asia, the management said they will monitor raw material prices and inventory levels amid geopolitical tensions. Supply disruptions pushed prices of active pharmaceutical ingredients and packaging higher, they said. The management said it was confident it could handle disruptions, but flagged that cost pressures are likely to impact the company's June quarter earnings.  

In FY27, the management sees US business growth in high single digits in dollar terms, supported by currency gains. On the launch of the biosimilar of Denosumab, Alkem Laboratories said approvals are in progress, and the drug is likely to be launched in the first quarter of FY28. The company is expected to launch Tolvaptan in the US during the second half of FY27. The market for Tolvaptan in the US is not yet crowded, management said. 

Growth in markets, apart from the US, is expected to be in the high teens. In the coming quarters, the company would seek approvals for semaglutide in these regions. 

On its medical technology business, the company plans to close the deal to acquire a majority stake in Switzerland-based Occlutech Holding AG in the next 45–60 days. The focus will be on Occlutech's integration into the business, management said. For the next 12 months, major acquisitions are not on the table. "We want to first actually integrate Occlutech into our Alchem MedTech business, and that itself will take another 12 months to do," management said. 

Alkem Laboratories' subsidiary in contract development and manufacturing, Enzene Biosciences Ltd., could achieve breakeven by the end of FY27, but its US subsidiary, Enzene Inc., will take longer. Revenues from Enzene Biosciences have started flowing in, the management said.

In FY27, research and development spend is seen at 4–5% of revenue from operations. In FY26, the figure was 4.2%. Other expenses in FY27 are likely to rise by 7–8%. In FY26, other expenses were INR 37.77 billion. They made up just over 30% of total spend.

On the likely candidate to replace Vikas Gupta as the chief executive officer, management said the search for a CEO is on and will take a few more months. The CEO will focus on the core pharmaceutical division and not group businesses, management said. Gupta will remain as the CEO till Jun. 30. 

The Mumbai-headquartered company's consolidated net profit fell nearly 23% on year to INR 2.36 billion. The company incurred a one-time cost of INR 1.35 billion due to impairment of assets and liabilities related to gratuity and leave encashment. Excluding this, net profit was INR 3.71 billion. The company's consolidated revenue rose nearly 15% on year to INR 36.03 billion. Sales in India rose 9% to INR 23.25 billion, while international sales rose 25% to INR 12.22 billion. Wednesday, shares of the company closed 1.3% higher at INR 5,451.50 on the National Stock Exchange. End

US$1 = INR 95.69

Edited by Mihika Basu

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