Akums Drugs and Pharmaceuticals reported a robust Q2 FY27, with consolidated revenue rising 31.9% YoY to Rs 1,342 crore. Profit after tax saw a sharp 168.3% jump to Rs 115 crore, driven by strong volumes in its core CDMO business. The company confirmed a $25 million contract with the Zambian government and is expanding capacity at its Baddi facility to support future growth.
Akums Drugs Reports Strong Q2 Performance
Revenue: Rs 1,342 crore (+31.9% YoY) | Profit After Tax: Rs 115 crore (+168.3% YoY)
Reader Takeaway: Robust CDMO volume growth and international contract wins drive performance, offset by domestic expansion-related margin pressure.
What just happened
Akums Drugs and Pharmaceuticals delivered a strong financial performance for the second quarter of fiscal year 2027. The company's consolidated revenue reached Rs 1,342 crore, while EBITDA surged 106% YoY to Rs 195 crore. EBITDA margins expanded by 520 basis points to 14.5%, signaling operational efficiency improvements despite higher input costs in specific segments.
Why this matters
The core CDMO business remains the primary engine for Akums, showing volume growth exceeding 20% on a September MAT basis. This validates the company’s business model as a contract manufacturer. The firm also successfully secured a $25 million confirmed purchase order from the Zambian government, with revenue realization expected in the first quarter of FY28.
Strategic & Operational Updates
Management is actively investing in the domestic branded segment, increasing the medical representative workforce from 1,400 to 1,600. While this investment created a short-term drag on EBITDA for that segment, the company views this as a necessity for long-term market capture. Additionally, the new Baddi facility is nearing Phase 1 completion, which will add 6 billion units of oral solid capacity in the next few months.
Risks to watch
The API segment continues to be a laggard, reporting an EBITDA loss of Rs 5.7 crore for the quarter. While losses are narrowing compared to the previous year, achieving a break-even status within the targeted 3-4 quarters remains a key monitorable. Furthermore, investors should track the regulatory status of the 158BC show-cause notice; management maintains that contractual terms protect the company from liability, and no financial provisions have been made to date.
What to track next
Watch for the timeline on European CDMO dossier approvals, which are anticipated in the next 1-2 quarters. The successful execution of the Zambia contract and the operational start of the Baddi facility will be crucial for maintaining the current growth momentum.