Investor sentiment was supported by management’s confidence in sustained growth driven by new launches, semaglutide traction and a robust pipeline in the US market, despite pressure on quarterly profitability. | Photo Credit: istock.com

Shares of Alkem Laboratories surged over 6 per cent in early trade before closing flat on Friday after the company reported strong revenue growth for the March quarter and issued a positive outlook for FY27, with management highlighting growth opportunities in India, the US and other international markets.

The stock climbed 6.1 per cent to a high of ₹5,789 on the NSE before settling flat at ₹5,498. Investor sentiment was supported by management’s confidence in sustained growth driven by new launches, semaglutide traction and a robust pipeline in the US market, despite pressure on quarterly profitability.

Alkem Laboratories reported consolidated profit after tax of ₹251.1 crore for the quarter ended March 2026, compared with ₹322.4 crore in the year-ago period. Revenue from operations rose y-o-y to ₹3,603.3 crore from ₹3,143.7 crore in the corresponding quarter last year.

The board recommended a final dividend of ₹10 per equity share.

Management guided for domestic formulations growth to outperform the Indian pharmaceutical market by 100-150 basis points in FY27, supported by improving demand trends and new molecules such as semaglutide. The company also expects higher single-digit y-o-y growth in the US market in constant currency terms, led by new product launches that are expected to offset pricing erosion in the base business.

Alkem said generic Tolvaptan has received approval from the USFDA and is expected to be launched in September or October 2026. Management indicated that the product is likely to face limited competition. The company also guided for higher teens y-o-y growth in the rest-of-the-world market for FY27.

EBITDA margin guidance for FY27 was maintained at 20-21 per cent. In Europe, the company has approvals for prolair and Xgeva biosimilars, with a commercial partner already in place for the prolair launch. Management also said the Occlutech deal is expected to close within 45-60 days.

Among global brokerages, Macquarie maintained an underperform rating with a target price of ₹4,900, stating that Q4 profitability missed estimates even though guidance remained broadly in line. The brokerage highlighted management’s expectation that the India branded generics business would outperform the Indian pharma market and noted semaglutide as a key growth driver.

Jefferies maintained a buy rating and marginally cut its target price to ₹6,500 from ₹6,550. The brokerage said Q4 performance beat expectations, with the US and rest-of-the-world businesses outperforming, while steady FY27 growth guidance and stable margins provided comfort despite cost pressures.

Among domestic brokerages, Motilal Oswal raised its FY27 and FY28 earnings estimates by 3 per cent and 5 per cent, respectively, citing a limited-competition pipeline in the US market, opportunities from semaglutide and a lower effective tax rate. The brokerage valued the stock at 28 times 12-month forward earnings and set a target price of ₹5,840.

Choice Institutional Equities said launch-led growth momentum was expected to continue, supported by products such as Valsartan, Tolvaptan and biosimilars, although margin expansion could moderate in the near term. The brokerage revised its FY27 and FY28 earnings estimates lower and retained a target price of ₹5,755, while highlighting additional upside potential from the Medtech and CDMO businesses.

More Like This

Published on May 29, 2026