Alkem Labs Q2 Results: Revenue falls but profit and margin expand from last year

Alkem Laboratories on Wednesday, November 13, reported a 11% year-on-year increase in net profit to ₹689 crore in the September quater. The company reported ₹621 crore profit in the corresponding quarter of the previous year.

Revenue from operations were down marginally by 0.7% on-year to ₹₹3,414.6 crore in the quarter under review as against ₹3,440 crore in the same quarter last year.

India sales stood at ₹2,461 crore, a 5.7% YoY growth whereas international sales came in at ₹918 crore, with YoY de-growth of 12.9%.

For the quarter, R&D expenses stood at ₹146.5 crore, or 4.3% of total revenue from operations, compared to ₹115.8 crore in Q2FY24 at 3.4% of total revenue from operations.

Earnings before interest, tax, depreciation, and amortisation or EBITDA is almost flat at ₹753 crore, compared to ₹746.7 crore in the year-ago period.

EBITDA margin expanded by 30 basis points to 22%, compared to 21.7% in Q2FY24.

“We are pleased to share that the outcomes of our strategic initiatives designed to enhance profitability have proven effective. We are prioritising a high-margin product mix, aligning more effectively with market demands, and implementing cost-control measures to mitigate inefficiencies, which are supporting EBITDA margin growth," said Alkem CEO Vikas Gupta.

"In the domestic market, our focus remains on augmenting the growth of our large brands and making strategic portfolio additions. We also see significant opportunities for growth in our emerging markets business,” Gupta said.

Following the Q2 earnings announcement, shares of Alkem Laboratories Ltd. are trading 0.82% lower at ₹5,458. The stock has risen about 7% so far in 2024.