Alkem revenue rises 13.8% as September profit falls 14.4%

Alkem Laboratories Limited reported consolidated revenue from operations of Rs 4,551.99 crore for the quarter ended 30 September 2026, up 13.8% year on year, while profit for the period fell 14.4% to Rs 667.13 crore as total tax expense rose to Rs 331.91 crore from Rs 116.23 crore a year earlier.

Why did Alkem’s September-quarter profit fall despite higher revenue?

Alkem’s reported profit declined because the increase in tax expense exceeded the growth in profit before tax. Profit before tax rose 11.6% year on year to Rs 999.65 crore in the September 2026 quarter from Rs 895.83 crore, while total tax expense increased by Rs 215.68 crore to Rs 331.91 crore. The group also recorded a Rs 61 lakh share of loss from its associate, compared with Rs 49 lakh in the prior-year quarter.

Current tax more than doubled to Rs 405.34 crore from Rs 179.95 crore, while deferred tax was a credit of Rs 73.43 crore against a Rs 63.72 crore credit a year earlier. Alkem said tax for the current period was recognised at enacted rates under the new tax regime after the parent and one Indian subsidiary opted for that regime from financial year 2026-27. The quarter also included a Rs 35 crore exceptional recovery on an investment impaired during the quarter and year ended 31 March 2026.

How did Alkem’s costs and operating profit change?

Alkem’s total expenses increased 16.0% to Rs 3,721.55 crore in the September 2026 quarter from Rs 3,208.85 crore a year earlier, outpacing revenue growth. Employee benefits expense rose to Rs 896.52 crore from Rs 710.25 crore, other expenses increased to Rs 1,135.53 crore from Rs 968.94 crore, and cost of materials consumed grew to Rs 1,083.03 crore from Rs 905.57 crore.

Profit before exceptional items and tax nevertheless increased 7.7% to Rs 964.65 crore from Rs 895.83 crore. Finance costs rose to Rs 57.67 crore from Rs 35.02 crore, while depreciation and amortisation increased to Rs 137.08 crore from Rs 93.61 crore. Other income rose to Rs 134.21 crore from Rs 103.69 crore, and the Rs 35 crore exceptional recovery lifted reported profit before tax to Rs 999.65 crore.

On a sequential basis, revenue from operations was Rs 3,740.15 crore in the quarter ended 30 June 2026, making the September-quarter figure Rs 811.84 crore higher. Profit for the period increased from Rs 520.98 crore in June 2026 to Rs 667.13 crore in September 2026. Basic and diluted earnings per share, which are not annualised, rose sequentially to Rs 56.48 from Rs 43.49 but remained below Rs 63.99 in the September 2025 quarter.

Which Alkem business segments drove September-quarter revenue?

Alkem’s Pharmaceuticals segment drove the revenue increase, reporting Rs 4,347.92 crore of segment revenue in the September 2026 quarter, up from Rs 3,889.99 crore a year earlier. Its segment result increased to Rs 1,051.88 crore from Rs 833.12 crore. Pharmaceuticals therefore accounted for most of the Rs 559.94 crore increase in total segment revenue before inter-segment eliminations.

Biotech segment revenue declined to Rs 129.79 crore from Rs 158.22 crore, while its segment result changed to a loss of Rs 114.14 crore from a profit of Rs 35 lakh a year earlier. MedTech revenue rose to Rs 133.14 crore from Rs 2.70 crore, while its segment loss widened to Rs 49.63 crore from Rs 6.31 crore. Alkem changed its reportable segment structure to Pharmaceuticals, Biotech and MedTech following the July 2026 acquisition of control in Occlutech Holding AG.

For the six months ended 30 September 2026, consolidated revenue from operations increased 12.5% to Rs 8,292.14 crore from Rs 7,372.13 crore. However, six-month profit for the period declined 17.9% to Rs 1,188.11 crore from Rs 1,447.02 crore. Pharmaceuticals generated a Rs 1,821.27 crore segment result in the six-month period, whereas Biotech and MedTech recorded losses of Rs 205.42 crore and Rs 61.88 crore, respectively.

What do Alkem’s cash flow and balance-sheet figures show?

Alkem generated net cash from operating activities of Rs 1,044.58 crore in the six months ended 30 September 2026, up from Rs 836.57 crore in the corresponding 2025 period. Cash generated from operations rose to Rs 1,412.24 crore from Rs 1,072.26 crore, although income taxes paid increased to Rs 367.66 crore from Rs 235.69 crore. Working-capital movements consumed Rs 475.91 crore, compared with Rs 642.74 crore a year earlier.

Net cash used in investing activities declined to Rs 378.31 crore from Rs 1,568.36 crore in the prior-year six months. The 2026 figure included Rs 808.04 crore of purchase consideration for business acquisitions, net of acquired cash, and Rs 320.89 crore of purchases of property, plant and equipment and related intangible assets. Financing activities used Rs 443.92 crore, compared with net cash generated of Rs 463.31 crore in the earlier period, including Rs 124.82 crore of dividends paid.

Total assets stood at Rs 23,059.64 crore on 30 September 2026, up from Rs 20,872.97 crore on 31 March 2026. Goodwill rose to Rs 1,221.02 crore from Rs 523.64 crore and other intangible assets increased to Rs 1,360.76 crore from Rs 256.76 crore. Alkem’s acquisition of a 55% stake in Occlutech, completed on 16 July 2026, created provisional goodwill of Rs 703.60 crore; the purchase price allocation remains to be finalised within the Indian Accounting Standard 103 measurement period.

Conclusion

Alkem delivered higher September-quarter revenue and a higher profit-before-tax figure, led by Pharmaceuticals, but reported consolidated profit declined as tax expense rose sharply. Biotech moved from a small segment profit to a loss, while MedTech revenue expanded after the Occlutech transaction but also reported a larger loss. Six-month operating cash generation increased even as six-month profit fell.

The disclosed item to watch is the finalisation of the provisional purchase price allocation for the 55% Occlutech acquisition, which may result in retrospective adjustments from 16 July 2026. Alkem’s subsequent results will also show how the new MedTech reporting segment develops after its September-quarter revenue reached Rs 133.14 crore and its segment loss was Rs 49.63 crore.