Alembic margin rebounds, but stays below healthcare peer median
Standalone revenue grew +25.02% YoY as costs rose slower, while operating margin remained 4.44 percentage points below the median of 31 reporting healthcare peers.
Filed 04 Aug 2026, 14:10 IST · Alembic Pharmaceuticals Ltd (APLLTD)
Key takeaways
- Standalone revenue grew +25.02% YoY as expenses rose +18.89%, lifting operating margin by 4.21 percentage points.
- Net profit rose +90.26% YoY, but the tax rate increased 5.50 percentage points and other income contributed 5.49% of pre-tax profit.
- Operating margin recovered 2.56 percentage points QoQ to 18.51%, though it remained 4.44 percentage points below the 22.95% healthcare-peer median.
Price around the results
Revenue growth translated into a larger operating gain
Alembic’s standalone revenue growth outpaced expense growth in both comparisons: +25.02% YoY versus +18.89% for expenses, and +8.69% QoQ versus +5.37%. That operating leverage lifted operating profit by +61.79% YoY and +26.18% QoQ. Lower interest expense YoY, down -5.43%, also supported the pre-tax result, although depreciation rose +12.50%.
Margin recovery came with a tax normalisation
Operating margin expanded 4.21 percentage points YoY and 2.56 percentage points QoQ because costs grew more slowly than revenue. Net profit growth was also helped by the comparison with Q4FY26, when the tax rate was -40.13%; the rate moved to 23.03% this quarter, a 63.16 percentage-point increase QoQ. Other income was 5.49% of pre-tax profit, so it was a modest contributor rather than the main source of earnings.
Margin trend turns up after two quarterly declines
The margin had declined from 16.89% in Q2FY26 to 16.54% in Q3FY26 and 15.95% in Q4FY26, before recovering to 18.51% in Q1FY27. Even after that rebound, Alembic ranked eighth from the bottom among 31 healthcare companies that had reported, with a margin 4.44 percentage points below the 22.95% peer median.
US launches and pipeline remain the operating focus
Management said the company launched seven products in the US during Q1FY27 and that its FY27 pipeline includes more than 15 launches. It also said the US branded business is being strategically expanded, including through the addition of Nuvessa, while Pivya’s soft launch had received encouraging market response. Management said R&D is focused on peptide development and increased filings, and that the API business remains focused on cost efficiency.
Past result-day reactions have been evenly split
Across eight prior result reactions, the stock rose four times and fell four times. The median absolute move was 2.88%, indicating that the historical response has been mixed rather than consistently directional.
Q1FY27 at a glance
Standalone figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹1,868 cr | ₹1,719 cr | +8.69% | +25.02% |
| Other income | ₹14 cr | ₹1 cr | +1153.57% | +80.23% |
| Expenses | ₹1,522 cr | ₹1,445 cr | +5.37% | +18.89% |
| Operating profit | ₹346 cr | ₹274 cr | +26.18% | +61.79% |
| Operating margin (%) | 18.51% | 15.95% | — | — |
| Interest | ₹21 cr | ₹19 cr | +10.25% | -5.43% |
| Depreciation | ₹83 cr | ₹82 cr | +0.28% | +12.50% |
| Profit before tax | ₹256 cr | ₹173 cr | +47.53% | +103.87% |
| Tax | ₹59 cr | ₹-70 cr | — | +167.91% |
| Net profit | ₹197 cr | ₹243 cr | -18.97% | +90.26% |
| EPS (₹) | ₹10.02 | ₹12.37 | -19.00% | +90.13% |
Operating margin of 18.51% compares with a Healthcare sector median of 22.95% across 31 peers that have reported Q1FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- The company launched seven products in the US in Q1 FY27.
- The company filed three US DMFs in Q1 FY27.
Guidance & outlook
- The US pipeline includes more than 15 product launches expected in FY27.
- Alembic targets net zero emissions by 2050.
- Alembic targets 63% GHG emission reduction by 2034.
- Alembic targets water neutrality by 2027.
- Alembic targets planting 50,000 trees by 2027.
Expansion
- The company plans strategic expansion in its US branded business.
- The company is enhancing its global presence through a Canadian JV and subsidiaries in Thailand, the Philippines and Germany.
- The US portfolio is expanding through the addition of Nuvessa.
New products
- Pivya completed its soft launch with encouraging market response.
- Nuvessa is being added to the US portfolio.
New initiatives
- The R&D pipeline focuses on peptide development and increased filings.
- The API business is continuing its focus on cost efficiency to remain competitive.
Competition
- Alembic is ranked 21st in the Indian Pharmaceutical Market.
- Alembic is a market leader in haematinics and antibiotics in animal health.
What to watch
- Whether standalone operating margin holds above 18.51% after the 2.56 percentage-point QoQ recovery.
- Progress from the seven US products launched in Q1FY27 against management’s stated FY27 pipeline of more than 15 launches.
- Whether the tax rate remains near 23.03% rather than repeating Q4FY26’s -40.13% rate.