Alkem Labs Q2 Revenue Grows 14%; PAT Declines 12%

ALKEM reported a mixed Q2 FY27 performance, with consolidated revenue from operations increasing 13.8% year-on-year to ₹4,552 crore. However, net profit after non-controlling interest declined 11.7% to ₹675.3 crore, compared with the corresponding quarter last year, highlighting the divergence between topline growth and bottom-line performance. EBITDA stood at ₹1,025.2 crore, up 11.3% YoY, with an EBITDA margin of 22.5%. The company’s profit before tax, excluding exceptional items, rose 7.7% to ₹964.6 crore. The domestic business continued to provide support, generating sales of ₹3,027.5 crore, up 9.5% year-on-year. International sales recorded stronger growth of 22.3% to ₹1,454 crore, despite continued pricing pressure in the US market. Biotech sales declined 35% to ₹70.4 crore, while MedTech sales stood at ₹133.1 crore, including the consolidation of Occlutech from Q2 FY27. Alkem also increased its research and development expenditure to ₹195.3 crore, equivalent to 4.3% of revenue, compared with 3.3% in the year-ago quarter. This reflects continued investment in its product pipeline and future growth opportunities. The company reported net cash of ₹4,905.4 crore as of September 30, 2026. For investors, key monitorables include domestic formulation growth, US pricing trends, R&D productivity, margin sustainability, and the integration of Occlutech. The rise in revenue is encouraging, but recovery in net profit and operating margins will be important to assess the quality of earnings momentum. Learning Takeaway: Revenue growth does not always translate into higher net profit. Investors should evaluate EBITDA margins, R&D expenses, segment performance, tax impact and profitability trends to understand the underlying earnings quality of pharmaceutical companies. Disclosure: This post is for educational purposes only and does not constitute investment advice. Any holdings or conflicts of interest should be disclosed separately.