Alivus Life Sciences: Navigating Growth with Strategic Precision in Q2 FY26

Alivus Life Sciences Limited, a prominent developer and manufacturer of active pharmaceutical ingredients (APIs), has reported a dynamic performance for the second quarter and half year ended September 30, 2025. The company, formerly known as Glenmark Life Sciences Limited, showcased resilience and strategic agility, delivering a healthy 16% year-on-year (YoY) revenue growth to 588 Crore in Q2 FY26. This growth was significantly propelled by its non-GPL business, which demonstrated an impressive 39.7% YoY surge. Despite a moderated overall growth due to a decline in the GPL segment, the company maintained robust profitability, with EBITDA climbing 35.7% YoY to 193.9 Crore, achieving a strong 33% EBITDA margin.

The non-GPL business proved to be a significant growth driver, fueled by healthy demand across key geographies including ROW, LATAM, Japan, Europe, and India. This broad-based performance underscores the inherent strength of Alivus's core operations and its diversified market presence. Conversely, the GPL business experienced a de-growth of 23.9% YoY, primarily attributed to inventory rationalization at the customer's end. The CDMO business, while appearing soft in the first half, is anticipated to rebound strongly in the second half with the addition of new projects and ramp-up of existing ones. The company's therapeutic mix also highlights a focus on chronic therapies, which contributed 69% to the revenue in Q2 FY26, reflecting its specialization in high-value, non-commoditized APIs.

Strategic Growth Levers and Capacity Expansion

Alivus is actively pursuing several strategic initiatives to fuel future growth. In the Gx API business, the focus remains on new product launches, geographical expansion, and targeting new, regulated markets, alongside pursuing second-source opportunities with leading generic players. For new growth levers, the company is ramping up its CDMO capabilities and expanding into complex API platforms, including iron compounds, oncology, and high-potent APIs. These efforts are supported by a robust R&D pipeline, with 586 DMF and CEP filings globally as of September 30, 2025, and 26 high-potent API products in the active grid.

Capacity expansion is a cornerstone of Alivus's growth strategy. The greenfield Solapur plant, with a planned 1000 MT capacity, is progressing, with Phase 1 (200 KL) construction underway and expected to be operational by April next year. Further phases are planned for FY27 and FY28, including backward integration. Brownfield expansions at Ankleshwar (100 KL addition) and Dahej (160 KL addition) are also on track, with new projects at Ankleshwar expected to be operational by Q2 FY27 and Dahej by Q1 FY27. These expansions are critical to meet anticipated demand and support the company's ambitious growth trajectory. The company's management highlighted that while capex spending in H1 FY26 was slower than planned (113 Crore vs. 600 Crore budget), they expect to spend around 250 Crore in H2, emphasizing a deliberate approach to ensure optimal fit and FDA approvability for new facilities.

Operational Excellence and Financial Health

Operational efficiencies are a key focus for Alivus, with initiatives such as debottlenecking, adoption of 2nd/3rd generation processes, backward integration, reducing carbon footprint, and implementing flow chemistry in manufacturing. These efforts are designed to reinforce margins and ensure sustained profitability. The company's financial health remains strong, being a net debt-free entity with significant cash and cash equivalents of 652.6 Crore as of September 30, 2025. This robust liquidity position provides ample support for ongoing growth plans and strategic investments.

Management acknowledged the temporary softness in the CDMO business and the de-growth in GPL, providing clear explanations related to existing project slowdowns and customer inventory rationalization. Despite these headwinds, the outlook for the second half of FY26 remains positive, with expectations of a stronger performance driven by a rebound in CDMO and GPL, coupled with continued robustness in the non-GPL segment. The company's commitment to maintaining margins around 30% without PLI benefits further underscores its operational strength and disciplined execution.

Outlook and Investor Confidence

Alivus Life Sciences is strategically positioned for sustained growth, leveraging its diversified portfolio, robust R&D, and expanding manufacturing capabilities. The management's confidence in delivering high single-digit revenue growth for FY26, supported by a stronger second half, reflects a clear vision and disciplined execution. The company's focus on high-value APIs, coupled with its expanding CDMO services and operational efficiencies, positions it well to capitalize on evolving market opportunities and deliver long-term value to its stakeholders.