Akums Q2 FY27 profit rose 168% as margin reached 14.5%

In the second quarter of fiscal year 2027 (Q2 FY27), Akums reported profit after tax (PAT) of Rs 115 crore, up 168.3% year on year, as revenue rose 31.9% to Rs 1,342 crore and earnings before interest, tax, depreciation and amortisation (EBITDA) margin widened to 14.5% from 9.3%.

What drove Akums’ Q2 FY27 profit growth?

Akums’ Q2 FY27 profit growth was driven by a Rs 101 crore increase in EBITDA and a Rs 89 crore increase in profit before tax. Revenue rose to Rs 1,342 crore from Rs 1,018 crore in Q2 FY26, while EBITDA more than doubled to Rs 195 crore from Rs 94 crore. PAT rose to Rs 115 crore from Rs 43 crore, taking PAT margin to 8.4% from 4.1%.

The cost structure grew more slowly than revenue in the year-on-year comparison. Cost of goods sold (COGS) increased 29.4% to Rs 767 crore, below the 31.9% rise in revenue, while the margin shown in the presentation increased to 42.9% from 41.8%. Employee expenses increased 18.5% to Rs 224 crore and other expenses rose 10.9% to Rs 157 crore.

Akums’ EBITDA bridge attributes the 5.2-percentage-point expansion in EBITDA margin to a 1.1-percentage-point gross-margin gain, a 1.9-percentage-point benefit from employee expenses and a 2.2-percentage-point benefit from other expenses. The presentation says employee and other expenses benefited from operating leverage, while gross-margin improvement was led by contract development and manufacturing organisation (CDMO) and active pharmaceutical ingredients (API) segments.

How did Akums’ revenue and margins change from Q1 and last year?

Akums increased Q2 FY27 revenue by 15.1% from Rs 1,167 crore in the first quarter of fiscal year 2027 (Q1 FY27) and by 31.9% from Rs 1,018 crore in Q2 FY26. EBITDA increased 11.5% sequentially from Rs 175 crore and 106.1% year on year from Rs 94 crore. PAT rose 13.5% from Rs 101 crore in Q1 FY27 and 168.3% from Rs 43 crore a year earlier.

The sequential and year-on-year comparisons show different margin movements. EBITDA margin fell 0.5 percentage points from 15.0% in Q1 FY27, despite the Rs 20 crore increase in EBITDA, but was 5.2 percentage points above Q2 FY26. PAT margin was unchanged sequentially at 8.4% and was 4.3 percentage points above the 4.1% reported a year earlier.

Other income declined to Rs 29 crore in Q2 FY27 from Rs 32 crore in Q2 FY26 and Rs 30 crore in Q1 FY27. Finance cost was Rs 26 crore, versus Rs 23 crore a year earlier, while depreciation and amortisation increased to Rs 43 crore from Rs 38 crore. Even with those movements, profit before tax rose 135.6% year on year to Rs 155 crore, and tax rose to Rs 40 crore from Rs 23 crore.

Which Akums segments accounted for Q2 revenue and EBITDA?

Akums’ CDMO segment accounted for most of the Q2 FY27 expansion, with revenue rising 38.6% year on year to Rs 1,115 crore from Rs 804 crore. CDMO represented 83.1% of consolidated revenue and generated EBITDA of Rs 168 crore, compared with Rs 84 crore in Q2 FY26. Its EBITDA margin increased to 15.1% from 10.5%, although it was below the 17.0% reported in Q1 FY27.

The domestic branded formulation segment added Rs 132 crore of Q2 FY27 revenue, up 8.2% year on year and 14.4% sequentially. Its EBITDA was Rs 24 crore, compared with Rs 26 crore a year earlier and Rs 12 crore in Q1 FY27; margin was 18.2%, versus 21.6% in Q2 FY26 and 10.3% in Q1 FY27. International branded formulation revenue reached Rs 44 crore, up 95.2% from Rs 22 crore, while EBITDA doubled to Rs 10 crore.

The smaller segments moved in opposite directions. API revenue fell 35.3% year on year to Rs 29 crore and its EBITDA loss was Rs 6 crore, narrower than the Rs 14 crore loss in Q2 FY26 but wider than the Rs 4 crore loss in Q1 FY27. Trade generics revenue declined 5.4% year on year to Rs 23 crore, but EBITDA turned positive at Rs 1.2 crore compared with a Rs 3 crore loss a year earlier.

Akums said CDMO volume growth remained in double digits and capacity utilisation was above 50% during Q2 FY27. It also said API prices continued to increase, though at a slower pace, while API losses were curtailed significantly. The presentation describes domestic and international branded formulation margins as lower year on year but improved sequentially, and says trade generics continued to break even.

What does Akums’ H1 FY27 performance show about cash and returns?

The first half of fiscal year 2027 (H1 FY27) extended the quarterly earnings trend, with Akums’ revenue up 22.9% to Rs 2,509 crore and PAT up 100.7% to Rs 216 crore. EBITDA increased 65.3% to Rs 369 crore, and EBITDA margin expanded to 14.7% from 10.9% in H1 FY26. PAT margin rose to 8.4% from 5.1% over the same period.

CDMO remained the principal H1 growth contributor, as revenue increased by Rs 461 crore to Rs 2,079 crore. Domestic branded formulation added Rs 18 crore to reach Rs 247 crore, and international branded formulation rose by Rs 21 crore to Rs 78 crore. API revenue fell by Rs 29 crore to Rs 60 crore, while trade generics declined by Rs 4 crore to Rs 44 crore.

Working-capital data show net working-capital days at 98 in H1 FY27, compared with 91 in H1 FY26 and 105 at FY26. Debtor days improved to 63 from 67 a year earlier, while inventory days rose to 117 from 100 and creditor days increased to 82 from 76. Adjusted operating cash flow was Rs 256 crore and adjusted operating cash flow as a share of EBITDA was 69.2%, compared with 88.7% in H1 FY26.

The presentation annualises half-year return measures. On that basis, return on equity was 12.2% in H1 FY27 versus 6.8% in H1 FY26, return on capital employed was 19.4% versus 13.1%, and return on invested capital was 22.2% versus 13.0%. These movements coincided with the increase in H1 EBITDA from Rs 223 crore to Rs 369 crore.

Conclusion

Akums’ Q2 FY27 results show profit rising faster than revenue as EBITDA increased 106.1% to Rs 195 crore and PAT increased 168.3% to Rs 115 crore. CDMO was the principal numerical contributor, adding Rs 311 crore of quarterly revenue and Rs 84 crore of EBITDA, while consolidated EBITDA margin rose from 9.3% to 14.5%.

The next points to watch are whether CDMO utilisation remains above 50%, whether the API loss narrows further from Rs 6 crore, and progress on the upcoming facilities listed in the presentation. Akums identifies cosmeceutical facilities at Roorkee and Noida for 2026 and a general facility at Baddi for 2027.