🔍Technical Analysis
Alkem Laboratories has demonstrated a remarkable 10-year growth trajectory, steadily climbing from ₹1,100 levels to reach an all-time high of ₹6,440 by September 2024. This represented an exceptional 5.8x growth over the decade.
Post the peak, the stock witnessed a sharp correction falling to ₹4,500 levels - a critical juncture that proved to be a strong demand zone. The ₹4,500 level acted as robust support, triggering an immediate bounce back following the announcement of super positive Q1 FY26 results.
Currently trading at ₹5,300, the stock has recovered strongly from the demand zone, representing a 17.8% bounce from the lows. This technical recovery is now backed by fundamental strength.
Entry Strategy: Enter on any dips toward ₹5,000-₹5,200 range with strict adherence to the ₹4,500 support level.
Targets:
🎯Target 1: ₹5,800
🎯Target 2: ₹6,200
🎯Target 3: ₹6,500
Stop Losses:
🚫Critical Stop: ₹4,500 (strong demand zone)
Breach of ₹4,500 level would completely invalidate the bullish thesis and signal no further expectations on this stock.
💰Q1 FY26 Financial Highlights (vs Q4 FY25 & Q1 FY25)
🧠Fundamental Highlights
Alkem Labs delivered exceptional Q1 FY26 performance with consolidated net profit surging 107% QoQ and 21.45% YoY to ₹668 crore, demonstrating remarkable operational recovery. Revenue growth of 11.2% YoY to ₹3,371 crore reflects strong business momentum across segments.
The company is India's fifth-largest pharmaceutical company with market cap of ₹63,937 crore and promoter holding of 53.0%. Post-results announcement, the stock jumped 7.5% reflecting market confidence in the turnaround story.
EBITDA growth of 21% YoY showcases improved operational efficiency and margin expansion. The company maintains FY26 guidance and expects India business to outpace IPM growth by 100-150 basis points, indicating sustained market share gains.
Strategic expansion plans include incorporating a subsidiary in international markets, positioning for global growth opportunities. Analyst target price of ₹5,700 supports the technical target zone, with forecast models projecting potential upside to ₹6,207 levels.
Management remains optimistic about sustained growth trajectory driven by strong domestic performance and strategic initiatives in key therapeutic segments.
✅Conclusion
Alkem Labs' spectacular 107% QoQ PAT recovery from the ₹4,500 demand zone, combined with 21% YoY growth and strong operational metrics, validates the technical bounce-back thesis. The current trading level of ₹5,300 offers attractive entry for targeting ₹6,500 levels. Critical support at ₹4,500 must hold for continued bullish momentum. The convergence of technical recovery and fundamental turnaround makes this a compelling pharma sector play.
Alkem Laboratories has demonstrated a remarkable 10-year growth trajectory, steadily climbing from ₹1,100 levels to reach an all-time high of ₹6,440 by September 2024. This represented an exceptional 5.8x growth over the decade.
Post the peak, the stock witnessed a sharp correction falling to ₹4,500 levels - a critical juncture that proved to be a strong demand zone. The ₹4,500 level acted as robust support, triggering an immediate bounce back following the announcement of super positive Q1 FY26 results.
Currently trading at ₹5,300, the stock has recovered strongly from the demand zone, representing a 17.8% bounce from the lows. This technical recovery is now backed by fundamental strength.
Entry Strategy: Enter on any dips toward ₹5,000-₹5,200 range with strict adherence to the ₹4,500 support level.
Targets:
🎯Target 1: ₹5,800
🎯Target 2: ₹6,200
🎯Target 3: ₹6,500
Stop Losses:
🚫Critical Stop: ₹4,500 (strong demand zone)
Breach of ₹4,500 level would completely invalidate the bullish thesis and signal no further expectations on this stock.
💰Q1 FY26 Financial Highlights (vs Q4 FY25 & Q1 FY25)
- Total Income: ₹3,371 Cr (↑ +7% QoQ from ₹3,144 Cr; ↑ +11% YoY from ₹3,032 Cr)
- Total Expenses: ₹2,632 Cr (↓ -4% QoQ from ₹2,752 Cr; ↑ +9% YoY from ₹2,423 Cr)
- Operating Profit: ₹739 Cr (↑ +89% QoQ from ₹391 Cr; ↑ +21% YoY from ₹609 Cr)
- Profit Before Tax: ₹771 Cr (↑ +95% QoQ from ₹396 Cr; ↑ +25% YoY from ₹619 Cr)
- Profit After Tax: ₹668 Cr (↑ +107% QoQ from ₹322 Cr; ↑ +21% YoY from ₹550 Cr)
- Diluted EPS: ₹55.56 (↑ +117% QoQ from ₹25.58; ↑ +22% YoY from ₹45.60)
🧠Fundamental Highlights
Alkem Labs delivered exceptional Q1 FY26 performance with consolidated net profit surging 107% QoQ and 21.45% YoY to ₹668 crore, demonstrating remarkable operational recovery. Revenue growth of 11.2% YoY to ₹3,371 crore reflects strong business momentum across segments.
The company is India's fifth-largest pharmaceutical company with market cap of ₹63,937 crore and promoter holding of 53.0%. Post-results announcement, the stock jumped 7.5% reflecting market confidence in the turnaround story.
EBITDA growth of 21% YoY showcases improved operational efficiency and margin expansion. The company maintains FY26 guidance and expects India business to outpace IPM growth by 100-150 basis points, indicating sustained market share gains.
Strategic expansion plans include incorporating a subsidiary in international markets, positioning for global growth opportunities. Analyst target price of ₹5,700 supports the technical target zone, with forecast models projecting potential upside to ₹6,207 levels.
Management remains optimistic about sustained growth trajectory driven by strong domestic performance and strategic initiatives in key therapeutic segments.
✅Conclusion
Alkem Labs' spectacular 107% QoQ PAT recovery from the ₹4,500 demand zone, combined with 21% YoY growth and strong operational metrics, validates the technical bounce-back thesis. The current trading level of ₹5,300 offers attractive entry for targeting ₹6,500 levels. Critical support at ₹4,500 must hold for continued bullish momentum. The convergence of technical recovery and fundamental turnaround makes this a compelling pharma sector play.
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.