Q3 2026 Gufic Biosciences Ltd Earnings Call

February 16, 2026

Speaker #1: Ladies and gentlemen, good day and welcome to the Gufic Biosciences Q2, Q3, FY26 earnings conference call. As a reminder, all participant lines will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes.

Speaker #1: Should you need assistance during this conference call, please signal an operator by pressing the star key followed by zero on your touch-tone phone. Please note that this conference is being recorded.

Speaker #1: I now hand the conference over to Ms. Shweta Shetty, Assistant Company Secretary at Gufic Biosciences Ltd. Thank you, and over to you, ma'am.

Speaker #2: Good afternoon, everyone. I welcome you all to Gufic Biosciences Ltd. earnings conference call for the third quarter of financial year 2025-26. We have with us today for the call Mr. Pranav Choksi, CEO and full-time director.

Ami Shah: Good afternoon, everyone. I welcome you all to Gufic Biosciences Limited Earnings Conference Call for the third quarter of financial year 2025-2026. We have with us today for the call Mr. Pranav Chokshi, CEO and Full-Time Director, Mr. Devkinandan Roonghta, CFO, and Mr. Avik Das from Investor Relations team, to give the highlights of the business and financial performance of the company and to take questions, if any. Before we begin, I would like to say that some of the statements that will be made in today's discussion may include certain forward-looking statements which are projections or estimates about future events. This estimate reflects management's current expectation about future performance of the company. This estimate involves a number of risks and uncertainties that could cause our actual results to differ materially from what is expressed or implied.

Speaker #2: Mr. Devkinandan Rumta, CFO, and Mr. Avik Das from the Investor Relations team, will give the highlights of the business and financial performance of the company and will take questions, if any.

Speaker #2: Before we begin, I would like to say that some of the statements that will be made in today's discussion may include certain forward-looking statements, which are projections or estimates about future events.

Speaker #2: These estimates reflect management's current expectations about the future performance of the company. These estimates involve a number of risks and uncertainties that could cause our actual results to differ materially from what is expressed or implied.

Speaker #2: Gufic does not undertake any obligation to publicly update any forward-looking statements, whether because of new information, future events, or otherwise. I hope you have received the investor presentation that we have posted on our website.

Ami Shah: Gufic does not undertake any obligation to publicly update any forward-looking statements, whether because of new confirmation, future events, or otherwise. I hope you have received the investor presentation that we have posted on our website. I will now hand over the call to Mr. Avik for sharing the business highlights. Over to you, Avik.

Speaker #2: I will now hand over the call to Mr. Avik for sharing the business highlights. Over to you, Avik.

Speaker #3: Good afternoon, everyone, and thank you for joining. I'll start with a brief update on what progressed across our business units, where execution is tightening.

Avik Das: Good afternoon, everyone, and thank you for joining. I'll start with a brief update on what progressed across our business units, where execution is tightening, before Pranav takes you through the divisional performance trajectory and Indore ramp-up. So across the domestic branded portfolio, the focus remains consistent, which is drive protocol, leg depth, improve mix through science-backed differentiation, and scale through repeatable execution rather than only through launches. So first, on our hospital injectable platform, execution remains hospital first and account depth driven. In critical care, we continue to concentrate on protocol-heavy segments of sepsis, other resistant infections, and invasive fungal diseases, where the adoption translates into repeat ordering....

Speaker #3: Before Pranav takes you through the divisional performance trajectory and indoor ramp-up across the domestic branded portfolio, the focus remains consistent, which is to drive protocol-led depth, improve mix through science-backed differentiation, and scale through repeatable execution rather than only through launches.

Speaker #3: First, on our hospital injectable platform, execution remains hospital-first and account-depth-driven. In critical care, we continue to concentrate on protocol-heavy segments of sepsis and other resistant infections and invasive fungal diseases, where the adoption translates into repeat ordering.

Speaker #3: Over the period, we progressed evidence-led positioning and hospital adoption for some of our advanced molecules, including thymosin alpha-1, which is Immunosin Alpha in sepsis and adjacent immune dysfunction, and dalbavancin, our brand Dalbavan, for resistant gram-positive infections, and isovuconazole, where we have a brand called Isovufic, in complex fungal infections.

Avik Das: Over the period, we progressed evidence-led positioning and hospital adoption for some of our advanced molecules, including thymosin alpha 1, which is Immunocin Alpha in sepsis, adjacent immune dysfunction, and Dadantrone, our brand Dadantrone for resistant gram-positive infections, and isavuconazole, where we have a brand called I-Isavufic in complex fungal infections. The emphasis remains on increasing molecule class share within existing ICU accounts and scaling through corporate chain and tertiary hospital penetration. In Sparsh, we tightened the operating engine. We brought in a lot of distribution control and collection discipline, and conversion inside hospitals, while continuing to build differentiation through formats like dual chamber bags. The next category triggers in Sparsh will be contrast media and the total parenteral nutrition range, which we will be launching. The progress to expand wallet share within existing accounts is also progressing well.

Speaker #3: The emphasis remains on increasing molecule-class share within existing ICU accounts and scaling through corporate chain and tertiary hospital penetration. In SPARSH, we tightened the operating engine; we brought in a lot of distribution control, collection discipline, and conversion inside hospitals.

Speaker #3: While continuing to build differentiation through formats like dual-chamber bags, the next category triggers in SPARSH will be contrast media and the total parenteral nutrition range, which we will be launching.

Speaker #3: The progress to expand wallet share within existing accounts is also progressing well. Now, on our women's health platform, there's been a shift towards a prescription-led engine with deeper lifecycle coverage in Ferticare.

Avik Das: Now, on our women's health platform, it's been a shift towards prescription-led engine with deeper life cycle coverage. In Ferticare, the strategy remains centered on reproductive immunology and increasing share of cycle in IVF. Core brands continue to compound very well, Gufesin Alpha in recurrent implantation failure, alongside Puregraf and Centrocare. And we progressed pipeline work on super pure urinary FSH to expand the stimulation opportunity with high purity and yet very cost-efficient propositions. In Zenova, the execution cadence improved, and our power brands continue to anchor growth, which is DD1 and StretchNil. With fertility adjacency building through Fertifos, the pipeline remains focused on the larger women's health therapy pools of endometriosis, PCOS, and menopause. This will help us widen our long-term prescriber relevance.

Speaker #3: The strategy remains centered on reproductive immunology and increasing share of cycle in IVF. Core brands continue to compound very well. Guficin Alpha in recurrent implantation failure, alongside PureGraf and CetraCare, and we progressed pipeline work on super-pure urinary FSH to expand the stimulation opportunity with high purity and yet very cost-efficient propositions.

Speaker #3: In Zenova, the execution cadence improved, and our power brands continue to anchor growth, which is DD1 and Stretchnil. With fertility adjacency building through 34s, the pipeline remains focused on the larger women’s health therapy pools of endometriosis, PCOS, and menopause. This will help us widen our long-term prescriber relevance.

Speaker #3: Now, coming to the toxin platform, here we are building a high lifetime value franchise through capability creation and structured market development. In Astoderm, we continue scaling Stonox, which is our botulinum toxin type A, while building the capability bridge to a broader aesthetic platform.

Avik Das: Now, coming to the toxin platform, where we are building a high, a lifetime value franchise through capability creation and structured market development. In Astoderm, we continue scaling Stonox, which is our botulinum toxin type A, while building the capability bridge to a broader aesthetic platform. Injector creation and chain clinic readiness and Indian clinical data generation is something that we focused on to support premium adoption. In neurocare, the progress remains very methodical, which is expanding the therapeutic toxin coverage just beyond neurology into urology, ophthalmology, pain, and neurosurgery, and of course, anchored on indications where adoption is guideline and guideline-driven and long duration. Now, coming to our Nutra Ayurveda platform, where we are sharpening our focus into a chronic care platform.

Speaker #3: Injecta creation and chain clinic readiness and Indian clinical data generation is something that we focused on to support premium adoption. In NeuroCare, the progress remains very methodical, which is expanding the therapeutic toxin coverage just beyond neurology into urology, ophthalmology, pain, and neurosurgery.

Speaker #3: And, of course, anchored on indications where adoption is guideline- and guideline-driven, and long duration. Coming to our Neutra Ayurveda platform, where we are sharpening our focus into a chronic care platform, we continue strengthening differentiated pain propositions such as the upgraded Gufican oil while building on the GI opportunity with Monoprazole.

Avik Das: We continued strengthening a differentiated pain proposition, such as the upgraded Gufican Oil, while building on the GI opportunity with vonoprazan, where we have a brand called Vonsa as a prescription-led growth lever. Now, I'll give you all a quick highlight of our international business, where we are moving towards an IP-controlled, complex, injectable-led market access model. During the period, we saw regulatory progress in regulated and priority semi-regulated markets, including colistimethate approval in Germany and regulatory continuity actions for pantoprazole injection in Portugal, and vancomycin injection in Lithuania. We expanded registrations in Myanmar across a basket including pantoprazole, azithromycin, and fertility hormones, and strengthening the quality gateway through Unit II GMP approval in Oman, which opens up the lucrative Middle East market for us.

Speaker #3: We have a brand called Wonswa as a prescription-led growth lever. Now, I'll give you all a quick highlight of our international business, where we are moving towards an IP-controlled, complex injectable-led market access model. During the period, we saw regulatory progress in regulated and priority semi-regulated markets.

Speaker #3: Including cholestinated approval in Germany, and regulatory continuity actions for pantoprazole injection in Portugal, and vancomycin injection in Lithuania. We expanded registrations in Myanmar across a basket including pantoprazole, azithromycin, and fertility hormones.

Speaker #3: And strengthened the quality gateway through Unit 2 GNP approval in Oman, which opens up the lucrative Middle East market for us. Finally, on Indore, the ramp-up continues in a stepwise, compliance-first manner, with disciplined tech transfer and scaling aligned to our audit readiness.

Avik Das: Finally, on Indore, the ramp-up continues in a stepwise compliance-first manner, with disciplined tech transfer and scaling aligned to our audit readiness. Rana will address the Indore ramp-up curve and how the divisional execution has translated into our overall performance trajectory. Now over to Roonghta, sir, for the overall quarter numbers.

Speaker #3: Pranav will address the indoor ramp-up curve and how the divisional execution has translated into our overall performance trajectory. Now, over to Roomta sir for the overall quarter numbers.

Speaker #1: Thank you, Avik. I am going to give a financial highlight for Q3 of financial year 25-26 versus Q2 of financial year 25-26. I am not able to compare Q3 of 25-26 versus Q3 of 24-25 because the indoor plant was capitalized during the last week of December 2024.

Devkinandan Roonghta: Thank you, Avik. I will going to give a financial highlight for Q3 of financial year 2025-26 versus Q2 of financial year 2024-25. I'm not able to compare the Q3 of 2025-26 versus Q3 of 2024-25, because the Indore plant was capitalized during the last week of December 2024. I'm making a comparison of Q3 versus Q2 of financial year 2025-26. The turnover for Q3 is INR 231.1 crore, compared to Q2 of INR 230.4 crore. The EBITDA for Q3 is INR 37.1 crore, compared to Q2 of INR 37.5 crore. The EBITDA margin for Q3 is 16.05%, compared to Q2 of 16.45%. The profit before tax margin, profit before tax for Q3 is INR 21.1 crore, compared to Q2 of INR 20.5 crore.

Devkinandan Roongta: Thank you, Avik. I will going to give a financial highlight for Q3 of financial year 2025-26 versus Q2 of financial year 2024-25. I'm not able to compare the Q3 of 2025-26 versus Q3 of 2024-25, because the Indore plant was capitalized during the last week of December 2024. I'm making a comparison of Q3 versus Q2 of financial year 2025-26. The turnover for Q3 is INR 231.1 crore, compared to Q2 of INR 230.4 crore. The EBITDA for Q3 is INR 37.1 crore, compared to Q2 of INR 37.5 crore. The EBITDA margin for Q3 is 16.05%, compared to Q2 of 16.45%. The profit before tax margin, profit before tax for Q3 is INR 21.1 crore, compared to Q2 of INR 20.5 crore.

Speaker #1: I'm making a comparison of Q3 versus Q2 of financial year 25-26. The turnover for Q3 is ₹231.1 crore compared to Q2 of ₹230.4 crore.

Speaker #1: The EBITDA for Q3 is ₹37.1 crore compared to Q2 of ₹37.5 crore. The EBITDA margin for Q3 is 16.05% compared to Q2 of 16.45%.

Speaker #1: The profit before tax for Q3 is ₹21.1 crores compared to Q2 of ₹20.5 crores. The tax margin is ₹9.13 crores in Q3 compared to ₹98.90 crores in Q2.

Devkinandan Roonghta: The VAT margin is 9.13 in Q3, compared to 9.89 in Q2. The profit before tax is INR 15.63 crore, INR 15.6 crore in Q2, compared to INR 13.99 crore in Q2.

Devkinandan Roongta: The VAT margin is 9.13 in Q3, compared to 9.89 in Q2. The profit before tax is INR 15.63 crore, INR 15.6 crore in Q2, compared to INR 13.99 crore in Q2.

Speaker #1: The profit before tax is ₹15.63 crores in Q3 compared to ₹13.9 crores in Q2. The tax margin is 6.75% in Q3 compared to 6.47% in Q2.

Pranav Choksi: ... The EBITDA margin is 6.75% in Q3 compared to 6.47% in Q2. Thank you.

Devkinandan Roongta: ... The EBITDA margin is 6.75% in Q3 compared to 6.47% in Q2. Thank you.

Speaker #1: Thank you.

Speaker #2: So, shall we go ahead and proceed with the Q&A session? All right. Thank you. Ladies and gentlemen, we will now begin the Q&A session.

Operator: Shall we go ahead and proceed with the Q&A session?

Operator 2: Yes, you can.

Operator: Yes, you can.

Operator: Thank you. Ladies and gentlemen, we will now begin with the Q&A session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to please use handsets while asking a question. Ladies and gentlemen, we will now wait for a moment while the question queue assembles. Our first question comes from the line of Nitya Shah from Kamaya Kya Wealth Management. Please go ahead.

Speaker #2: Anyone who wishes to ask a question may press star and 1 on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and 2.

Speaker #2: Participants are requested to please use handsets while asking a question. Ladies and gentlemen, we will now wait for a moment while the question queue assembles.

Speaker #2: Our first question comes from the line of Nithya Shah from Kamayakya Wealth Management. Please go ahead.

Speaker #4: Yeah, hi. Am I audible?

Nitya Shah: Yeah, hi. Am I audible?

Speaker #2: You are audible, sir. You may proceed.

Operator: You are audible, sir. You may proceed.

Speaker #4: Yes. So, hi team. Just wanted to understand some more about the ramp-up, as was discussed in the last call—that Q3 and Q4 will see a disproportionate rise as more of the regulatory approvals come in and exports pick up.

Nitya Shah: Yes. So hi, team. Just wanted to, you know, understand some more that, you know, the ramp up as was discussed in the last call, that you know Q3 and Q4 will see a disproportionate rise as you know more of regulatory approvals come in and exports pick up. But, the numbers are saying otherwise, that there are many segments, many interesting developments going on, but we are seeing growth of only, you know, 11% to 12% on a year-over-year basis, and even quarter-over-quarter, it's flat. So any color that is just due to some critical price erosion or what is the scenario here?

Speaker #4: But the numbers are saying otherwise—that there are many segments, many interesting developments going on. But we are seeing growth of only 11 to 12 percent on a year-on-year basis.

Speaker #4: And even quarter-on-quarter, it's flat. So, any color—is this due to some critical price erosion, or what is the scenario here?

Speaker #1: Yeah, hi, Nithya Pranav here. So, yeah, if you remember, you called the call of Q2. We already had got Mr. Rajesh called for Sparish.

Pranav Choksi: Yeah, hi, Nitya. Pranav here. So, yeah-

Nitya Shah: Yeah, hi.

Pranav Choksi: If you remember, recall the call of Q2, we already had got Mr. Rajesh Kaul for Sparsh. And in critical care also, if you remember, we were directly billing to the hospitals, and we were in the process of revamping our operations, a part of critical care and also Sparsh from going from, you know, direct hospital supply to, you know, taking it back as a stockist, because a lot of our working capital was getting affected in the long cycle. So, as last quarter also, we took a hit of around, I think, INR 5, 6 crores. This quarter also, we have taken a hit of INR 14 to 16 crores. And if you remember, the debtors at a turnover of INR 800 crores was around INR 320 crores last year, approximately.

Speaker #1: And in critical care also, if you remember, we were directly billing to the hospitals, and we were in the process of revamping our operations—apart from critical care, and also Sparish—from going from direct hospital supply to taking it back as a stockist, because a lot of our working capital was getting affected in the long cycle.

Speaker #1: So, as last quarter also, we took a hit of around, I think, ₹5–6 crores. This quarter also, we have taken a hit of ₹14 to 16 crores.

Speaker #1: And if you remember, the debtors at a turnover of ₹800 crore was around ₹320 crore last year, approximately—might be plus or minus. And this year, our target is also, with the jump from ₹800 crore to whatever we end up at—₹900 crore plus, maybe ₹920 crore, ₹930 crore, whatever.

Nitya Shah: Right.

Pranav Choksi: I might be ±. This year our target is also with the jump from INR 800 crore to whatever we end up, INR 900+ crore, or maybe INR 920 crore, INR 930 crore, whatever. So that way also we want to bring the debtors sub INR 300 crore. So when in July, Mr. Rajesh call came in, we did an audit of the market, that which are the primary, secondary, or tertiary hospitals, where what is the reason that this, you know, money is not coming? Is it stock or is it just cycles or is it some other evaluation? So there has been a, you know, comprehensive approach, which started in, of course, Q2, where the impact was only INR 5-6 crore. This quarter has been INR 14-16 crore. As per our estimates, in Q4, it might be between INR 3-5 crore more.

Speaker #1: So, that way also, we want to bring the debtors sub-300. So, when in July Mr. Rajesh called, came in, we did a reiki of the market—like, which are the primary, secondary, or tertiary hospitals, and what is the reason that the money is not coming?

Speaker #1: Is it stock, or is it just cycles, or is it some other evaluation? So there has been a comprehensive approach which started in, of course, Q2, where the impact was only five, six years.

Speaker #1: This quarter has been 14 to 16. As per our estimates in Q4, it might be between 3 to 5 crore more. But that is what—we have taken a hit once to get that product out and get the debtors in control.

Pranav Choksi: But that is what we have taken, a hit once to get that product out and get the debtors in control, because it should not happen that the expiry of the product also gives, and the hospital still refuse to pay because they are ready to keep the stock at our expense.

Speaker #1: Because it should not happen that the expiry of the product also comes, and the hospital still refuses to pay because they are ready to keep the stock at our expense.

Speaker #1: So, at the same time, we saw an uptrend in exports, and we saw an uptrend in 40 Care as well as in other segments.

Nitya Shah: Right.

Pranav Choksi: So and at the same time, we saw an uptrend in exports, and we saw an uptrend in Ferticare as well as in, in other segments. So, you know, and now Indore is also ramping up. So we don't want to compromise-

Nitya Shah: Right.

Speaker #1: So, and now Indore is also ramping up. So we don't want to compromise the ramp-up of Indore, in terms of the backing capital, by just in the Indian market, still give those 3 Bs without any recourse.

Nitya Shah: Right.

Pranav Choksi: The ramp up of Indore in terms of the working capital by just in the Indian market still do give those freebies without any recourse. And, you know, and that's the reason that this consciously has been done this year, because like I started-

Speaker #1: And that's the reason that this consciously has been done this year. Because, like I started the call, in Q1 or Q2 also, the 320 of our 800 was quite not digestible, neither for the CFO nor for me.

Nitya Shah: Okay.

Pranav Choksi: The call in Q1 or Q2 also, the 320 of our over 800 was quite not digestible, neither for the CFO nor for me. And, you know, it, it would not be a good sign in the market also. So that is how this is the thing which we have done. A majority has been finished, like I said, 5, 6 last quarter and 14 to 16 this quarter. Next quarter, even with that 3 to 5, we are still looking at, you know, that improvements to come in or other things start kicking in. Even without the GLP uptake, we look at some positivity. Yeah.

Speaker #1: And it would not be a good sign in the market also. So that is how this is the thing which we have done. Majority has been finished, like I said, 5 or 6 last quarter and 14 to 16 this quarter.

Speaker #1: Next quarter, even with that 3 to 5, we are still looking at those improvements to come in because other things start kicking in. Even without the GLP update, we look at some positivity.

Speaker #1: Yeah.

Speaker #4: Okay. Is there any price erosion in the critical segment, or have the prices stabilized?

Nitya Shah: Okay. Is there any, like, price erosion in the critical segment, or have the prices stabilized?

Speaker #1: No, no. If you see, the gross margins are not a concern. If you see, that's not a concern, very frankly. On the contrary, the astronomy I'll be back to, which was supposed to be launched, will be launching hopefully by this quarter or maybe Q1.

Pranav Choksi: No, no. If you see, the gross margins are not a concern. If you see, that's not a concern, very frankly.

Nitya Shah: Okay.

Pranav Choksi: On the contrary, the AstraZeneca bacteria, which was supposed to be launched, will be launching, hopefully by this quarter on, maybe Q1. I think that will also add in the margin. So erosion, I think that the worst has failed, you know, the APIs and all that is done. So I don't think that's the process. At the same time, even in fertility, the price is quite stable. On the contrary, even taking this hit back, the exports have compensated. So yeah, that's why you see the gross margin is not getting affected much.

Speaker #1: So that will also add in the margin. So, erosion—I think that the worst has failed. The APIs and all that is done. So I don't think that's the process.

Speaker #1: At the same time, even in fertility, the price is quite stable. On the contrary, even taking this hit back, the exports have compensated. So that's why you see the gross margins not getting affected much.

Speaker #4: Right. Right. Understood. So, what is your outlook for FY27? Say that once you move onwards from, say, 30% capacity utilization, are we looking to see a 20% plus kind of growth number in FY27?

Nitya Shah: Yeah. Right. Right. Understood. So, what is your outlook for FY 2027? Say that once you move onwards from, say, 30% capacity utilization, are we looking to see a 20% plus kind of growth number in FY 2027? Because, you know, it's been a very large capacity expansion. So when will we start seeing, like, a tangible payoff? I understand after the debtors have been, you know, sorted out, but when are we seeing a larger growth come in in FY 2027? What is your expectation on that?

Speaker #4: Because it's been a very large capacity expansion. So, when will we start seeing a tangible payoff? I understand, after the debtors have been sorted out.

Speaker #4: But when are we seeing a larger growth come in, in FY27? What is your expectation on that?

Speaker #1: So, I would still stick to that. That if, from an 800-odd number—800, 810 last month to maybe, sorry, last year—to maybe, whatever, 920-plus this year, yes, definitely a minimum of 15% is what we look for next year.

Pranav Choksi: I would still stick to that, that if, you know, from an 800 odd number, 800, 810 last month to maybe... Sorry, last year, to maybe whatever, 920+ this year. Yes, definitely a minimum of 15% is what we look for next year. So like I said, It's a mandate given by the CFO and myself to the team, that whatever has to be done, we want to migrate to that stockist billing as soon as possible, and don't go for that, you know, I would say, stretched working capital. So I don't think the impact-

Speaker #1: So, like I said, it's a mandate given by the CFO and myself with the team that whatever has to be done, we want to migrate to that stockist billing as soon as possible.

Speaker #1: And don't go for that, I would say, stretched working capital. So I don't think the impact of that—what do you call this, Sparsh and critical care—would stretch on beyond this year.

Nitya Shah: Understood.

Pranav Choksi: Of that, what do you call this, Sparsh and critical care would stretch on beyond this year. So 15% bare minimum is what we target for 2027.

Speaker #1: So, a 15% bare minimum is what we target for '27.

Speaker #4: Understood. And on the regulatory side, is there any updates you'd like to give in terms of?

Nitya Shah: Understood. On the regulatory side, is there any updates you'd like to give in terms of?

Speaker #1: Yeah, sure. So, our EU audit was completed in the month of December, and that went well. So we hope, like I mentioned, that the certificate should come by March or April.

Pranav Choksi: Yeah, sure. So there has been... Our EU audit has been completed in the month of December, and that went well. So we hope, like I mentioned, that the certificate should come by March or April. So we already are advancing, and so we hope that the business as we are co-committing, if you see the earlier slide also, I think Avik must have presented.

Speaker #1: So we already are on that thing. And so we hope that the business, as we are committing, if you see the earlier slide also—I think Avik must have presented, sorry, in the presentation—we look at Q2, max Q3, for uplift of EU markets, at least from Indore.

Nitya Shah: Yeah.

Pranav Choksi: ... sorry, in the presentation, we look at Q2, max Q3 for uplift of EU markets, at least from Indore. In the meanwhile-

Speaker #1: In the meanwhile, there have been certain other contracts for Indore, which hopefully also should start paying off. So that is a possibility, yes.

Nitya Shah: Okay.

Pranav Choksi: There have been certain other contracts for Indore, which hopefully also should start paying off. So that is a possibility, yes.

Speaker #4: Okay, thank you. I'll get back in the queue. All the best.

Nitya Shah: Okay. Thank you. I'll get back in the queue. All the best.

Speaker #1: Yes.

Pranav Choksi: Yes.

Speaker #4: Thank you. Our next question comes from the line of Aditya Pal from MSA. Please go ahead.

Operator: Thank you. Our next question comes from the line of Aditya Pal from MSA. Please go ahead.

Speaker #5: Hello. Am I audible?

Aditya Pal: Hello, am I audible?

Speaker #4: You are audible, sir. You may go ahead.

Operator: You are audible, sir. You may go ahead.

Aditya Pal: Yes. Thank you so much for the opportunity. So a lot of my questions have been answered, but wanted to understand. So you explained the domestic business and you explained the injectables business. We were also expecting some uptick in our CMO business this quarter and going towards next quarter. So how is that panning out to be?

Speaker #5: Yes. Thank you so much for the opportunity. So, a lot of my questions have been answered, but I wanted to understand—so you explained the domestic business and you explained the international business.

Speaker #5: We were also expecting some business this quarter and going towards next quarter. So, how is that panning out to be?

Speaker #1: So if I don't go for the correction, we are still looking at around ₹200 crore, which is almost a 20% jump quarter-on-quarter if we remove this ₹14 to ₹16 crore.

Pranav Choksi: So if I don't go for the correction, we are still looking against that INR 200 crores, almost a 20% jump Q1 Q2, if we remove this INR 14 to 16 crore, what I'm trying to say. So definitely the Indore is... Because I, as you all know, Navsari is chock-a-block and saturated, so Indore is getting the uptake. There have been some GLP-1s, validation batches also we have taken. Apart from the audit, there have been other clients also who have come in. So that is happening. So if you—let's say, I'll give you some sort of a numbers. Whatever exposure was around, maybe INR 20 to 25 crores total output from Indore per quarter, that has at least gone to around 36 to 38. So that's a positive sign, and we hope that should go to close to 40, 42.

Speaker #1: What I'm trying to say—so definitely, Indore is, because as you all know, Nostari is chockablock and saturated. So Indore is getting the uptake.

Speaker #1: There have been some GLP one's validation batches also we have taken. Apart from the audit, there have been other clients also who have come in.

Speaker #1: So, that is happening. So, if you—let's say, I'll give you some numbers. Whatever exposure was around maybe ₹20 to ₹25 crores total output from Indore per quarter, that has at least gone to around ₹36 to ₹38 crores.

Speaker #1: So that's a positive sign. And we hope that should go to close to 40—40. I'm saying this includes not only the external numbers, but our internal production also.

Pranav Choksi: I'm saying this includes not only the external numbers, but our internal production also. So these are all positive signs from Indore, which will help us to, you know, take that uplift. And this is even without the exports kicking in, and this is without that. So all this is coming because of our internal and CMO only.

Speaker #1: So, these are all positive signs from Indore, which will help us to take that uplift. And this is even without the exports kicking in, and this is without us.

Speaker #1: So all this is coming because of our internal and CMO only.

Speaker #5: Understood. Understood. And in terms of the cost base, right? So, employee benefit expenses have been going up quarter on quarter. For the last four quarters, today it's at ₹40-odd crores.

Aditya Pal: Understood, understood. In terms of, in terms of the cost base, right? So employee benefit expenses has been going up quarter-over-quarter for the last four quarters. Today, it's at INR 40-odd crores. How much of this would be because the one-time labor cost, and how much would it be due to organic?

Speaker #5: How much of this would be because of the one-time labor costs, and how much would it be due to organic?

Speaker #1: I think Rumtaz will be a better person to answer that. And maybe I'll key in, in terms of output, later. Rumtaz, do you want to talk about the employee expense?

Pranav Choksi: I think Rungta sir may be a better person to answer that, and maybe I'll key in in terms of output later. Rungta sir, you want to talk about the employee expense, and then I'll come in in terms of the output also.

Speaker #1: And then I'll come in, in terms of the output also.

Speaker #5: Basically, if you want to see the other expenses, no. Also include the R&D and validation expenses. And at least for one and a half to two years, these expenses are going to be part of recurring expenses because Indore is required to have a lot of validation batches.

Devkinandan Roonghta: Basically, if you want to see the other expenses, no, it also includes the R&D and validation expenses, and at least for two years, one and a half to two years, this expense is going to be in part of recurring expenses, because Indore requires a lot of validation batches.

Devkinandan Roongta: Basically, if you want to see the other expenses, no, it also includes the R&D and validation expenses, and at least for two years, one and a half to two years, this expense is going to be in part of recurring expenses, because Indore requires a lot of validation batches.

Speaker #1: So my question, my question on employee benefit expenses, not other expenses.

Aditya Pal: No, sir, my question, my question is on employee benefit expenses, not other expenses.

Speaker #5: Absolutely. Okay. Employee benefit expenses today are around ₹40 crores per quarter. That will go to about ₹160 crores per year. Next year, you can see another hike of around 7% annual increment.

Devkinandan Roonghta: Okay. Okay, employee benefit expenses, sorry. Employee benefit expenses today is around INR 40 crore per quarter. It will go to INR 160 crore rupees per year. Next year, another quarter, you can see a hike of around 7% annual increment. The number is now seen. It's only annual increment, which has to be given to the employees, so it may touch from INR 160 crore to INR 175 crore.

Devkinandan Roongta: Okay. Okay, employee benefit expenses, sorry. Employee benefit expenses today is around INR 40 crore per quarter. It will go to INR 160 crore rupees per year. Next year, another quarter, you can see a hike of around 7% annual increment. The number is now seen. It's only annual increment, which has to be given to the employees, so it may touch from INR 160 crore to INR 175 crore.

Speaker #5: The number is now saved. It's only the annual increment which has to be given to the employees, so it may touch from 160 to 175.

Speaker #5: Understood. And now, this is a standard, now cost base. Forty is the largest quarterly expense we have started to expect.

Aditya Pal: Understood. And this, now this is a, this is standard now, cost base. We can. The 40 is the largest quarterly expense.

Devkinandan Roonghta: Almost all recruitment has been completed. There is no fresh recruitment, and the current increase will going to cover annual increment to the employees. This may increase from INR 160 to 175.

Devkinandan Roongta: Almost all recruitment has been completed. There is no fresh recruitment, and the current increase will going to cover annual increment to the employees. This may increase from INR 160 to 175.

Speaker #1: Almost all recruitment has been completed. There is no fresh recruitment, and only the increase will come as an annual increment to the employees.

Speaker #1: This may increase from 160 to 175.

Speaker #5: Understood. Understood. The question on productivity. So how are we looking at it?

Aditya Pal: Understood. Understood. The question on productivity, so how are we looking at QTM?

Speaker #1: There have been some six—sorry, there have been six high-profile appointments also this year, as you must have read. So, apart from getting Dr. Raj Shekhar for the international business, then ramping up his team for international business.

Pranav Choksi: There have been some six high-profile appointments also this year, as you must have read. You know, so apart from getting-

Aditya Pal: Yes.

Pranav Choksi: Dr. Rajasekhar for the international business, then ramping up his team for international business, and that's why you see the international business going from almost INR 120 to, you know, on a higher side, to going to around... So almost the majority of the growth, almost of around INR 60 to 70 crores, is coming from the international business, which are the base up around INR 120. I'm talking about the formulation exports, not the API exports.

Speaker #1: And that's why you see the international business going from almost 120, on the higher side, to going to around—so almost the majority of the growth, almost around 60 to 70 crores, is coming from the international business.

Speaker #1: So the base is around 120. I'm talking about the formulation exports, not the API exports. Similarly, for Rajiv Agarwal for infertility, and then Rajesh Kaul for Sparish. At the same time, Vijay Kumar for Galderma.

Aditya Pal: Yes.

Pranav Choksi: Similarly, for, you know, Rajiv Agarwal for infertility, and then, Rajesh Kaul for Sparsh. At the same time, Vijay Kumar for Galderma. From Galderma, of course, for Stonox. And at the same time also, we also have ramped up, like what Roonghta sir rightly explained. If you see Indore, which was an average of around 350 people, on an average, and of course, I'm saying post, the capitalization was out. So let's take the January to March quarter, which is a full quarter where there was no capitalization. There, the 350 has gone to a rightly peak of around 480, 500, which is what Roonghta sir rightly said, where we need to take care of all our requirements in Indore.

Speaker #1: From Galderma, of course, for Stanox. And at the same time, also, we have ramped up, like what Rumtaz rightly explained. If you see Indore, which was an average of around 350 people on average, and of course, I'm saying post the capitalization was out.

Speaker #1: So let's take the January to March quarter, which is a full quarter where there was no capitalization. There, the 350 has gone to a rightly peak of around 480, 500, which is what Rumtaz rightly said, where we need to take care of all our requirements in Indore.

Speaker #1: So even though the output on productivity has gone only from, I would say, 25-26 to around 38-42, the employees are full-fledged now.

Pranav Choksi: So even though the output on productivity has gone only from, I would say 25, 26 to around 38 to 42, the employees are full-fledged now. Now, even, even if I want to up-get my sales increase from 40 to beyond, we are almost at the peak, except for the yearly increments, which would come in, in terms of Indore. And of course, for Navsari and for field force, as he rightly said, the average increment would come to 6 to 7%, assuming, of course, the attrition. And the average that would normally 6, 7% is what we foresee from year to year, from now on.

Speaker #1: Now, even if I want to get my sales increase from 42 and beyond, we are almost at the peak, except for the yearly increments which would come in in terms of Indore.

Speaker #1: And of course, from Nostari, and for Fieldforce, as he rightly said, the average increment would come to 6–7 percent. Assuming, of course, the attrition.

Speaker #1: And the average, that would normally be 6–7 percent, is what we foresee from year to year, from now on.

Speaker #5: Understood. Understood. Just one last question before we come back in the queue. So, you answered to the previous participant that we are looking at a 50-odd percent at the bare minimum for coming in FY27-28.

Aditya Pal: Understood. Understood. Just, just last question before you come back in the queue. So you answered to the previous participant that we are looking at a 50-odd percent on the bare minimum for coming in, in FY 2027, 2028. FY 2027 and FY 2028. Now, the question is that because a lot of things are happening, we've got GLP-1, a lot of our CMO customers moving from Navsari to Indore and, fingers crossed, we get our EU cGMP earlier than expected or as expected, maybe by FY 2026. And you said that by Q2 or Q3, the revenues from the interactive business from Indore should start materializing. So, where what is keeping us on the fence to say that, not 20 percent, but 15 percent? Is there anything that we should be aware of?

Speaker #5: Your FY27 and your FY28. Now, the question is that because a lot of things are happening—we've got GLP-1, a lot of our CMO customers moving from Nostari to Indore, and fingers crossed, we get our EUC GMP earlier than expected, or as expected, maybe by FY26.

Speaker #5: And you said that by Q2 or Q3, the revenues from the international business from Indore should start materializing. Is that keeping us on the fence to say that not 20%, but 15%?

Speaker #5: Is there anything that we should be aware of?

Speaker #1: No, so again, one thing we have realized is that as you try to go on the international front, working capital is the most crucial thing.

Pranav Choksi: No. So I again say that, you know, one thing we have realized that, as you try to go on the international front, the working capital is the most crucial thing, and that is something has become a little bit more sanctified in the organization right now. So even though this year we could, you know, get those numbers, we have been very disciplined about it. So I don't want to, you know, have one more year where I commit something and I don't deliver. So at least what minimum what we give is what we should deliver. And, of course, there are, of course, many other moving parts which are positive, but if that comes anyway, you know, that's always a positive sign. You will never question me for that.

Speaker #1: And that is something that has become a little bit more sacrosanct in the organization right now. So, even though this year we could get those numbers, we have been very disciplined about it.

Speaker #1: So, I don't want to have one more year where I commit something and I don't deliver. So at least, whatever minimum we give is what we should deliver.

Speaker #1: And of course, if we—there are, of course, many other moving parts which are positive. But if that comes anyway, that's always a positive sign.

Speaker #1: You will never question me for it. So I always feel that when we would, putting me on the block, 15% is high time we give you bare minimum.

Pranav Choksi: So I always feel that when you're putting me on the block, 15% is high time we give you bare minimum. And whatever goes beyond, we all should be, you know, we'll take it at that time and be happy or not, let's decide at that time. Yeah.

Speaker #1: And whatever goes beyond, we all should be — we'll take it at that time and be happy or not. Let's decide at that time. Yeah.

Speaker #5: Understood. Understood. And on the CMO front, so last quarter when we were discussing, you said that 50% of the clients, of the 12–14 major clients, had moved to Nostari—and oh, sorry, Indore.

Aditya Pal: Understood, understood. And on the CMO front, so last quarter when you were discussing, you said that 50% of the client, of the 12, 14 major clients had moved, moved to Indore from Navsari, and we are also introducing a couple of new vial products, within them. The question is that, and you also mentioned that Q3 might not be that big of a quarter. Q4, we can expect a good quarter. So, if you can shed some light on that, how to look at it. Because, at a 9-25 growth, what will be the CMO percentage, the CMO revenue percentage?

Speaker #5: From Nostari, and we are also introducing a couple of new vial products within them. The question is that, and you also mentioned that Q3 might not be that big of a quarter.

Speaker #5: Q4, we can expect a good quarter. So if you can shed some light on that—how to look at it, because at 925, what will be the CMO percentage, CMO revenue percentage?

Speaker #1: Absolutely. So, if you see, when I mean 50% of my—so we have Unit 1, which is the hormone, and the other general facility, which is the legacy facility.

Pranav Choksi: Absolutely. So if you see, when I mean, 50% of my-- so we have a unit one, which is a hormone and other general facility, which is the legacy facility. Then we have a pen and block, then we have a unit two at Navsari. These are the three main units, apart from, of course, the botulinum toxin. So the unit two, where which is EU, Brazil, Canada, and all these other accreditations are there. That is out of that 50% clients have all moved to Indore, because we had to get the capacity free for our export orders to be taken care of.

Speaker #1: Then we have a pen and block. Then we have Unit 2 at Nostari. These are the three main units, apart from, of course, the Bottle and Toxin.

Speaker #1: So the Unit 2, which is EU, Brazil, Canada, and all these other accreditations, are there. Out of that, 50% of clients have all moved to Indore because we had to get the capacity free for our export orders to be taken care of.

Speaker #1: So, even right now, the order book which we have is more than around ₹150 to ₹155 crore at any time which we are running with, which is—I'm going to bring that order book down to at least ₹80 to ₹90 crore.

Aditya Pal: Right.

Pranav Choksi: So even right now, the order book, which we have, is more than around, you know, INR 150 to 155 crores at any time, which we are running with, which is high. I want to bring that order book down to at least INR 80, 90 crores, and it's something, you know, it's, it's almost like a 90-day window, which I want to bring it down to 60-day window. So that is the main purpose. So that definitely will happen in Indore, from the Unit 2, and, that is where we feel that, this will take on. Now, more interestingly, we also have got certain projects, for, GLP-1 in Indore also, apart from what we had in, Navsari.

Aditya Pal: Right.

Speaker #1: Then it's something. It's almost like a 90-day window, which I want to bring down to a 60-day window. So that is the main purpose.

Speaker #1: So that definitely is happening in Indore from Unit Two, and that is where we feel that this will take on. Now, more interestingly, we also have got certain projects for GLP-1 in Indore also, apart from what we had in Nostari.

Speaker #1: So, a little bit—because of those validation batches, and because of almost, that went for almost 33 for one of the big pharmas—they have gone for a little bit bohemian approach to GLP-1 from Indore, apart from the nominal conventional liquid product.

Pranav Choksi: So a little bit because of those validation batches and because of almost that went for almost 33 for one of the big pharmas, they have gone for a little bit bohemian approach to GLP-1 from Indore, apart from the normal conventional liquid product. So that is where our facility also little. We see a big upside happening there also. So that validation batches also are now getting done, I mean, it got done in January, and we are seeing the testing, everything in February. So a little bit of that December and January also went in that validation batches of the GLP-1 from Indore for those things, where we feel. You know, when you go for any validation or anything, almost your entire equipment is blocked for 3 days or 4 days, where it normally should be blocked only for 1.5 days.

Speaker #1: So that is where our facility is also; with a little look, we see a big upside happening there also. So those validation batches are now getting done—I mean, it got done in January—and we are seeing the testing, everything, in February.

Speaker #1: So a little bit of that December and January also went in the validation batches of the GLP-1 from Indore. For those things, when you go for any validation or anything, almost your entire equipment is blocked for three or four days, where it normally should be blocked only for one and a half days.

Speaker #1: So those are the two factors. I feel they should also take it more, and we also are pushing more and more of our clients. So we hope that by March, or maximum by June, at least the remaining 75–80 percent—remaining 50%, maybe 75–80%—also move through.

Pranav Choksi: So those are the two factors I feel should also take it more, and we also are pushing more and more of our clients. So we hope that by March or maximum by June, at least, you know, the remaining 75-80%... remaining 50%, maybe 75-80% also move through. So we become a little bit decluttered because Navsari's orders from UK and Germany, sorry, UK, Portugal, and Brazil and all that are also ramping up. So we hope that, that positivity, we can pass it on in terms of numbers.

Speaker #1: So we become a little bit decluttered because Nostari's orders from the UK, Portugal, Brazil, and all that are also ramping up.

Speaker #1: So, we hope that that positivity—we can pass it on in terms of numbers.

Speaker #5: Understood. Understood. No, we're seeing all the very best. I have a couple more questions. I'll come back in the queue. Thank you so much.

Aditya Pal: Understood, understood. No, wishing you all the way best. I have a couple of more questions. I'll come back in the queue. Thank you so much.

Operator: Thank you. Participants, to ask a question, you may press Star and one. Our next question comes from the line of Vishal Mehta from Oakland Capital. Please go ahead.

Speaker #6: Thank you. Participants, to ask a question, you may press star and one. Our next question comes from the line of Vishal Mehta from Oakland Capital.

Speaker #6: Please go ahead.

Speaker #7: Hello. Hi. Am I audible?

Vishal Mehta: Hello. Hi, am I audible?

Speaker #6: Yes, you are audible. You may proceed, sir.

Operator: Yes, you are audible. You may proceed, sir.

Vishal Mehta: Pranav, I just had one question on the botulinum toxin piece of our business. We've been working on it, developing it for, you know, almost three to five years now. What is the current size of that business? And how is it compared to, you know, the last couple of years, how has it grown? And with the team expanding, how do you see the growth in this segment for the next, say, maybe two, three years? And also, if you could just highlight what is our capacity here in terms of sales potential, and if there is any potential in terms of exports for this product.

Speaker #7: I just had one question on the Botox and toxin piece of our business. We've been working on it, developing it for almost three to five years now.

Speaker #7: What is the current size of that business? And how is it compared to the last couple of years? How has it grown? And with the team expanding, how do you see the growth in this segment for the next, maybe, two or three years?

Speaker #7: And also, if you could just highlight what is our capacity here in terms of sales potential, and if there is any potential in terms of exports for this product.

Speaker #1: Yeah, so if you see, the total Botulinum and Toxin market in India is around $20 to $25 million, both for therapeutic and aesthetics.

Pranav Choksi: Yeah. So, if you see the total botulinum toxin market in India is around $20 to 25 million, both for therapeutic and aesthetics. We are approximately at 23% of the market share, right now in terms of IQVIA, which is there. So we are around INR 25 to 30 crores right now, which is a total market share, which includes our aesthetics, our therapeutics, and of course, our government supply also. Now, this has of course, evolved from 2021, 2022, where the actual launch, first the aesthetic division was launched, and then in 2022, the therapeutic division was launched. And we grow on an average around... I mean, this year, of course, it was around 22% to 25%, but last two years it has been 30% and 40%, but the base is very low.

Speaker #1: We are approximately at 23% of the market share right now in terms of IQVIA, which is there. So we are around ₹25 to ₹30 crores right now, which is a total market share that includes our aesthetics, our therapeutics, and of course, our government supply also.

Speaker #1: Now, this has of course evolved from 2021, '22, where the actual launch—first the Aesthetic division was launched, and then in 2022, the Therapeutic division was launched.

Speaker #1: And we grow on an average around—I mean, this year, of course, it was around 22 to 25 percent. But the last two years, it has been 30% and 40% because the base is very low.

Speaker #1: Now, this—I foresee for it to grow in this thing. Luckily, with the team coming in in the month of February—of Mr. Vijay, Dr. Ja, and Dr. Jyoti Ja, and the entire team—a little bit there also, we have a little bit upgraded our selling talent.

Pranav Choksi: Now, this I foresee for it to grow in this thing. Luckily, with the team coming in in the month of February of Mr. Vijay, Dr. Jay and Dr. Jyoti Jay and the entire team, little bit, there also, we have little bit upgraded our selling talent. So there also, we have taken some teams from Galderma and toxin, which brings a lot of credibility. The perception what was earlier, you know, it's an Indian toxin. Now you have multinational team members endorsing it. We have now clinical trials also now published. I mean, one published, the second one being published by the end of this month in February. So those are bringing. Today also, I'm right now in Navi Mumbai, just attending the call because we had some doctors visiting in terms of scientific presentation discussion on botulinum toxin.

Speaker #1: So there also, we have taken some teams from Galderma and Toxin, which brings a lot of credibility. The perception, what was earlier, it's an Indian toxin.

Speaker #1: Now you have multinational team members endorsing it. We have now clinical trials also now published—at least one published. The second one is being published by the end of this month, in February.

Speaker #1: So those are bringing today also. I'm right now in Nostari, just attending the call because we had some doctors visiting in terms of scientific presentation discussion on bottle and toxin.

Speaker #1: So we hope that this is more of an educative thing, and it's more of a scientific thing, which will of course gather pace in terms of 20-25%.

Pranav Choksi: So we hope that this is more of an educative thing, and it's more of a scientific thing, which will, of course, gather pace in terms of 20 to 25%. There might be a hockey stick, which might come for the entire country, and when the entire category gets expanded, and we hope that we are in the first few to take it up. More importantly, what we lack, I'll tell you.

Speaker #1: There might be a hockey stick which might come for the entire country. And when the entire category gets expanded, we hope that we are in the first few to take it up.

Speaker #1: More importantly, what we lack—I'll tell you—what we lack right now is that, right now, doctors, when they endorse our toxin, they say, "Do you have an incomplete box?"

Pranav Choksi: What we lack right now is that, you know, right now, doctors, when they endorse our toxin, they say, "Do you have an incomplete basket, don't have a filler." So when they go to a Galderma or for an Allergan, they have a toxin, they have a filler, and as in combination, they feel if I stop buying an X from thing, I have to keep everyone happy, so I get only some part of the shelf. With our agreement with the Canadian company, which has been signed, of course, it has been signed now, so I can officially say that right now. So with that coming in, we should be hoping to get that product launched by June, July.

Speaker #1: You don't have a filler. So, when they go to a Galderma or to an Allergan, they have a toxin, they have a filler, and as in combination, they feel, if I stop buying an X from them, I have to keep everyone happy.

Speaker #1: So I get only some part of the shelf. With our agreement with the Canadian company, which has been signed—of course, it has been signed now.

Speaker #1: So I can officially say that right now. So, with that coming in, we should be hoping to get that product launched by June or July.

Speaker #1: Now, with that product coming in, we always will—there will be no excuse that, 'Why should doctors not endorse a product?' Because we have a product of fillers which is number two or number three in the US, which has a total revenue of more than $110 million.

Pranav Choksi: Now, with that product coming in, we always will—there will be no excuse that why a doctor should not endorse a product. Because we have an, you know, we have a product of fillers, which is number 2 or number 3 in US, which has a total revenue of more than $110 billion. You know, and we can backpack on that along with our toxin, and it can be a good, you know, I would say, complimentary basket. And then that also helps us to get little bit more market share. So even without the filler, we are able to get the 23 percent, 23 percent market share in a market where, of course, Allergan is almost like a 50 percent dominant market. So we hope we can take more share from them in the years to come.

Speaker #1: And we can backpack on that along with our toxin, and it can be a good, I would say, complementary basket. And then that also helps us to get a little bit more market share.

Speaker #1: So even without the filler, we are able to get the 23% market share in a market where, of course, Allergan is almost like a 50% dominant market.

Speaker #1: So, we hope we can take more share from them in the years to come. And more importantly, the category expansion to come—so that will help us to take into the Indian market.

Pranav Choksi: And more importantly, the category expansion to come, so that will help us to take into the Indian market. Coming to the international market, very frankly, let us first... I mean, my views are that for the next two, three years, let us focus on revamping the Indore, getting the, I would say, domestic market taken care of, have a robust system in place for both aesthetics and therapeutics, and get the fillers also in place. And then maybe from next year end, once the Indore is fully ramped up, maybe in 2027, 2028, start thinking for toxin for the international market. There have been opportunities, but we would like to keep it in the future.

Speaker #1: Coming to the international market, very frankly, let us first—I mean, my views are, for the next two, three years, let us focus on revamping the indoor, getting the, I would say, domestic market taken care of, have a robust system in place for both aesthetics and therapeutics, and get the fillers also in place.

Speaker #1: And then maybe from next year-end, once the indoor is fully ramped up, maybe in 2027 or 2028, start thinking about toxin for the international market.

Speaker #1: There have been opportunities, but we would like to keep it for the future.

Speaker #5: Great. Sorry, in terms of sales potential, in terms of capacity expansion, it would not be a challenge in this segment if at all demand comes through.

Vishal Mehta: Great. Sorry, in terms of sales potential, in terms of capacity expansion, would not be a challenge in this segment, if at all demand comes?

Speaker #1: No, sorry. I missed the question about the capacity. So the capacity is, I mean, right now, I sell almost around 20,000 vials, but my capacity can be even 20—I mean, 10 lakhs, 15 lakhs also.

Pranav Choksi: Sorry, I missed the question about the capacity. So the capacity is, I mean, right now, I sell almost around 20,000 vials per month. My capacity can be even 20, I mean, 10 lakhs, 15 lakhs also, that's not a problem. So right now, with 20,000 per month, these are the revenues what we have, INR 25 to 30 crore. So that's not a bottleneck for botulinum toxin. Even, and as you know, it's a product which we have our own strain, so we are not dependent on any third party also for APIs or toxin or something. Everything is made in.

Speaker #1: That's not a problem. So right now, with 20,000 per month, these are the revenues that we have—₹25 to ₹30 crore. So that's not a bottleneck for Bottle and Toxin.

Speaker #1: And as you know, it's a product for which we have our own strain. So, we are not dependent on any third party also for APIs or toxin or something.

Speaker #1: Everything is made in-house. Yeah.

Speaker #5: Great. That's very encouraging. And also, one small question on the margin side. We've given out 15% top-line bare minimum growth guidance. What is it that we look at in terms of margin trajectory with indoor ramping up?

Vishal Mehta: Got it. Great. That's very encouraging. And also, one small question on the margin side. You've given a 15% top-line bare minimum growth guidance. What is it that we look at in terms of margin trajectory with Indore ramping up? How do you see that panning out over the next two, three years?

Speaker #5: How do you see that panning out over the next two to three years?

Pranav Choksi: Can I request Roonghta sir to take this question? He'll be more precise. Yeah.

Speaker #1: Can I request Roomtester to take this question? It'll be more precise. Yeah.

Pranav Choksi: Can I request Roonghta sir to take this question? He'll be more precise. Yeah.

Speaker #5: So if you see the present, if it's a margin around 16%, after two, three years, when the capacity utilization of indoor will rise more than 50%, we expect the margin again, if it's a margin, will raise from 16% to 19%.

Devkinandan Roonghta: If you see the present, EBITDA margin is around 16%. After two, three years, when the capacity utilization of Indore will rise more than 50%, we expect the margin again, EBITDA margin will be raised from 16% to 19%. Once the utilization reached more than 75%, then the EBITDA margin may touch between 20 to 21%.

Devkinandan Roongta: If you see the present, EBITDA margin is around 16%. After two, three years, when the capacity utilization of Indore will rise more than 50%, we expect the margin again, EBITDA margin will be raised from 16% to 19%. Once the utilization reached more than 75%, then the EBITDA margin may touch between 20 to 21%.

Speaker #5: And once the utilization reaches more than 75%, then if it's a margin, it may touch between 20% and 21%.

Speaker #1: Great. Thank you so much, and all the best for your future.

Vishal Mehta: Great. Thank you so much and all the best for your future.

Speaker #5: Thank you. Thanks.

Devkinandan Roonghta: Thank you. Bye.

Devkinandan Roongta: Thank you. Bye.

Speaker #6: Thank you. Our next question comes from the line of Rahul Girish Shah from Glowstar LLP. Please go ahead. Rahul, your line has been unmuted.

Operator: Thank you. Our next question comes from the line of Rahul Girish Shah from GloStar LLP. Please go ahead. Rahul, your line has been unmuted. You may proceed with your question.

Speaker #6: You may proceed with your question.

Speaker #7: Yeah, my question is already answered. I mean, the same question I was going to ask about the margin part, because this quarter, what I could see is that with almost the same, we are nearing 30% utilization of indoor.

Rahul Girish Shah: Yeah, my question is already answered. I, the same question I was going to ask about the margin part, because this quarter, what I could see is that, with the same model, almost we are nearing 30% utilization at Indore, and, still, margin is compressed to 16%. Because it was earlier you mentioned that, Indore with which, it will get, EBITDA positive on, or EBITDA accretive, at 30% utilization. So is there any fixed cost is the only thing which is dragging the margin or the OpEx has slightly increased this year? That was my question.

Speaker #7: And still, margin is compressed to 16 because it shows earlier you mentioned that indoor with which it will get EBITDA positive on or EBITDA accretive at 30% utilization.

Speaker #7: So is it any fixed cost that is the only thing which is dragging the market, or has the OPEX slightly increased this year? That was my question.

Speaker #5: Basically, today, only because of the fixed cost, the EBITDA margin we are expecting is at the break-even in Q4 of financial year 2025-26.

Devkinandan Roonghta: Basically, today only because of the fixed cost, the EBITDA margin we are expecting at the breakeven in the Q4 of financial year 2025-26. And in 2027, we are expecting it will end of the 2027, we are expecting that interest and depreciation will also been absorbed by the Indore. And after 2027, it will start giving cash margin and as, as per our profit margin-

Devkinandan Roongta: Basically, today only because of the fixed cost, the EBITDA margin we are expecting at the breakeven in the Q4 of financial year 2025-26. And in 2027, we are expecting it will end of the 2027, we are expecting that interest and depreciation will also been absorbed by the Indore. And after 2027, it will start giving cash margin and as, as per our profit margin-

Speaker #5: And in '27, we are expecting it will end of the '27. We are expecting that interest and depreciation will also be absorbed by the indoor.

Speaker #5: And after '27, it will start giving cash margin. And as far as profit margin.

Rahul Girish Shah: Are we expecting Indore to reach 50% utilization in FY 27, by end of FY 20?

Speaker #7: Are we expecting indoor to reach 50% utilization in FY27 by end of FY27?

Devkinandan Roonghta: By end of, you can expect in Q4 of 2025 to 2026, 2027, the utilization may touch to 50%, but not as the average of whole full year.

Speaker #5: By end of the year, you can expect in Q4 of '25-'26-'27, the utilization may touch 50%, but not on average for the whole year.

Devkinandan Roongta: By end of, you can expect in Q4 of 2025 to 2026, 2027, the utilization may touch to 50%, but not as the average of whole full year.

Speaker #7: So that's great. And one more—the last question, if I can add it—when is the UK MHRA planned? Because it was originally planned for Q1.

Rahul Girish Shah: Oh, that's great. And one more, the last question, if I can add it to, when is the UK MHRA planned? Because it was originally planned for Q1. Is there any definitive date available there?

Speaker #7: Is there any definitive date available there?

Speaker #1: You're talking about indoor, right, sir?

Pranav Choksi: ... You're talking about Indore, right, sir?

Speaker #7: Yeah. You're talking about UK indoor.

Rahul Girish Shah: Yeah, we're talking about Indore.

Speaker #1: Yeah, so the indoor actual audit happened in the first week of December from the EU, Portugal. And if that goes through, then the UK will also accept the same in terms of harmonization.

Pranav Choksi: Yeah. So Indore, actually, audit has happened in the first week of December from EU, Portugal. And if that goes through, then UK also accept the same in terms of harmonization. So that audit has been done in the first week of December 2026, 2025, sorry. Yeah.

Speaker #1: So, that audit has been done in the first week of December 2025, sorry. Yeah.

Rahul Girish Shah: Oh, okay, okay. So, the Q2 or Q3, you said the orders and other things will start kicking on, which was hindering the growth, right? The export growth.

Speaker #7: Okay, okay. So, the Q2 or Q3—you said the orders and other things will start kicking in, which was hindering the growth, right? The export growth.

Speaker #1: Yeah, so the export revenue from indoor will start kicking in for Europe and the regulated markets from Q3, Q4, because we also have a Saudi audit in April.

Pranav Choksi: Yeah, yeah. So the export revenue from Indore will start kicking in for Europe and the regulated markets from Q3, Q4, because we also have a Saudi audit also in April. In the meanwhile, there are some basic registrations, like, you know, like, Southeast Asian and other markets where the export already has started from Q4 2026, and it will continue going for like Africa, Southeast Asia should, already-- has already started from this January 2026.

Speaker #1: In the meanwhile, there are some basic registrations like Southeast Asian and the other markets where the export already has started from Q4 '26, and it will continue going forward.

Speaker #1: Like Africa, Southeast Asia should already have started from this January 2026.

Speaker #7: Okay. You can update something about Celvex if the new investment is done. And the progress over there, if you can just give a little bit more.

Rahul Girish Shah: Okay. You can update something about Cellvex, if the new investment is done and the progress over there, if you can just give a little bit more, please.

Speaker #1: So I think it's a very far thing. But just to share with you, as you know, this is a cancer vaccine therapy for solid tumors.

Pranav Choksi: So I think it's a very far thing, but just to share with you, as you know, this is a cancer vaccine therapy for solid tumors. They had a very good remission rate of more than 60% to 70%, maybe more. I think Avik will be more precise with the numbers. And right now, they are plasmid, and their gene is already ramped up. They also are now in the process of getting it outsourced to Syngene to get their final constructs ready. For that, there was a requirement from all investors to pitch in something, and that's why we also felt that we should be part of the story, because we have 100% India rights, and we have also rights for the some part of Europe also. So this is a thing which I still am...

Speaker #1: They had a very good remission rate of more than 68, 70 percent—maybe more. I think a week will be more precise with the numbers.

Speaker #1: And right now, they are plasmid, and their gene is already ramped up. They also are now in the process of getting it outsourced to Syngene to get their final construct ready.

Speaker #1: For that, there was a requirement from all investors to pitch in something. And that's why we also felt that we should be part of the story because we have 100% India rights, and we also have rights for some part of Europe also.

Speaker #1: So this is a thing which I still am totally— I believe we must have invested close to 150,000 still now in the last four, five years.

Pranav Choksi: So totally, I believe we must have invested close to $150,000 till now in the last 4, 5 years. It's something, very long term, but I have a lot of hope and expectations. Let's see when it comes. It's very far-fetched. It will still take 5, 6 years.

Speaker #1: There's something very long-term, but I have a lot of hope and expectations. Let's see when it comes. It's very far-fetched. It'll still take five or six years.

Speaker #7: Yeah, yeah. It's like investing in a startup sort of thing. Yeah.

Rahul Girish Shah: Yeah, yeah. It's like investing in a startup sort of thing. Yeah.

Speaker #1: Yeah, more than a startup with good clinical background and good clinical data—at least on an animal level. So it's not completely proof of concept.

Pranav Choksi: Yeah, more than startup with good clinical background and good clinical data, at least on an animal level. So it's not completely proof of concept. It's proof of concept with some animal data. Yes. Yeah.

Speaker #1: It's proof of concept with some animal data. Yes. Yeah.

Speaker #7: Okay. Thanks. Thank you.

Rahul Girish Shah: Okay. Thank you.

Speaker #1: Thank you.

Pranav Choksi: Thank you.

Speaker #6: Thank you. Our next question comes from the line of Bhavya Sonawala from Samasa Capital. Please go ahead.

Operator: Thank you. Our next question comes from the line of Bhavya Sonawala from Samasta Capital. Please go ahead.

Speaker #5: Yeah, thank you. Am I audible?

Bhavya Sonawala: Yeah, thank you. Am I audible?

Speaker #6: You are audible, sir. You may go ahead.

Operator: You are audible, sir. You may go ahead.

Speaker #5: Yeah, just two questions. The first, I just want to understand—when we started the direct-to-hospital approach, we thought we would get some kind of understanding of the patterns, etc.

Bhavya Sonawala: Yeah, just two questions. First, just want to understand that when we started the direct to hospital approach, we thought we would get some kind of understanding of the patterns, et cetera, and now we are rolling it back. So what exactly, you know, are we-- what issues did we face that, you know, we are trying to roll it back, I think?

Speaker #5: And now we are rolling it back. So, what exactly are we—what issues did we face that we are trying to roll it back, I think?

Speaker #1: So if you see, during sparse and some part of primary care and critical care, we wanted to go through the primary and secondary nursing homes apart from the tertiary ring because we always thought that the tertiary nursing homes—I mean, tertiary, I mean the big guns of the Indian hospital, I mean, hospital industry.

Pranav Choksi: If you see during Sparsh and some part of primary care and critical care, we wanted to go through the primary and secondary nursing homes, apart from the tertiary thing, because we always thought that the tertiary nursing homes, I mean, tertiary, I mean, the big, big guns of the Indian hospital industry. They normally pay in 150, 180 days, but there we have distributors. So when we thought that there will be a better margin improvement and there will be more penetrative data where the margins will improve.

Speaker #1: They normally pay in 150, 180 days, but there we have distributors. So when we thought that there will be a better margin improvement, and there will be more penetrative data where the margins will improve.

Speaker #1: So the margins, of course, did improve, but the problem was when the margins improve at the cost of payment coming after almost 150 days or 180 days, where earlier we were a little bit, I would say, shielded by the distributors who used to pay us in 30 to 45 days.

Pranav Choksi: So the margins, of course, did improve, but the problem was when the margins improve at the cost of a payment coming after almost 150 days or 180 days, where earlier we were little bit, I would say, you know, shielded by the distributors who used to pay us in 30 to 45 days. But now with that thing happened in the last two years, and that's how from September, I mean, from August and September, we started changing this. Now, instead of... The main thing was the database. I'll come to the database. So what we tried last year, we knew this could not carry on. So from, I think around October, November 2024, I believe we also started requesting all our stockists to install Marg.

Speaker #1: But now that thing happened in the last two years. And that's how, from September—I mean, from August 10, September—we started changing this.

Speaker #1: Now, instead of the main thing, it was the database. I'll come to the database. So, what we tried last year, we knew this could not carry on.

Speaker #1: So from, I think, around October or November 2024, I believe we also started requesting all our stockists to install MARG. So, MARG is a particular software in India, where the sales from a stockist to the primary, secondary, or tertiary home can be checked, and at what rate is checked.

Pranav Choksi: So Marg is a particular software in India, where the sales from a stockist to the primary, secondary, or tertiary home can be, you know, checked and at what rate is checked. So that took us almost, almost eight to 10 months to convince the stockist that when we are installing this Marg patch or this data, none of their IP data will come to us. It's only that we will get data related to Gufic. So that implementation took time. It started in November, and it eventually got done by September 2025. And at that time, once we knew that now the Marg data is good enough, we thought this transition makes sense because at least we can still keep a control where our products are going.

Speaker #1: So, that took us almost 8 to 10 months to convince the stockist that when we are installing this MARG patch or this data, none of their IP data will come to us.

Speaker #1: It's only that we will get data related to Gupik, so that implementation took time. It started in November, and it eventually got done by September 2025.

Speaker #1: And at that time, once we knew that now the MARG data is good enough, we thought this transition makes sense because at least we can still keep a control where our products are going.

Speaker #1: And then we started this call that once now the MARG data is in place, let's start getting a little bit more strict about those hospitals which are eventually laggards and not paying us on time, at the same time stretching our working capital.

Pranav Choksi: And then we started this call that once now the Marg data is in place, let's start getting, you know, you know, a little bit more strict about those hospitals, which are eventually, you know, laggards and not paying us on time, at the same time, stretching our working capital. So yes, of course, with this, there will be a hit of around, some X percentage more, but that when I compare with the working capital and the interest cost, it's I think almost, you know, makes no difference. So this is what we took a call in August, September 2025.

Speaker #1: So yes, of course, with this, there will be a hit of around some X percent more. But when I compare with the working capital and the interest cost, I think it almost makes no difference.

Speaker #1: So, this is what we took a call in August, September 2025.

Speaker #5: Okay, understood. Just one more question. I think in your presentation, you have spoken about an astrodome. You have spoken about the global in-licensing.

Bhavya Sonawala: Okay, understood. Just one more question. I think in your presentation, you've spoken about Inastudium, you've spoken about the global in-licensing, and, I'm assuming that the same you refer to the Canadian brand. So is this any kind of tech transfer or is it a pure licensing deal? Can you just, you know, throw some light on that and what potential does it have?

Speaker #5: And I’m assuming that’s the same you refer to with the Canadian brand. So is this any kind of tech transfer, or is it a pure licensing deal?

Speaker #5: Can you just shed some light on that and what potential does it have?

Speaker #1: It's a pure licensing thing. The total fillers market in India is around ₹200 to ₹230 crores. The toxin market is close to around ₹120 to ₹140 crores, depending on the exchange rate and all that.

Pranav Choksi: It's a pure licensing thing. The total fillers market in India is around INR 200 to 230 crores. The toxin market is around, close to, you know, around INR 120 to 140 crores, depending on the exchange rate and all that. So we feel that the fillers also, once coming in, we can, you know, also play around and, more than the fillers, they have a good product in the pile in terms of PDRNs and those other conjugates, which are the new age thing. So fillers are, are now, but the future products are going to be PDRN and exosomes. And also they have some unique medical devices which help us for administration of certain specific, aesthetic products also. So it's, it's a good collaboration.

Speaker #1: So we feel that the fillers also, once coming in, we can also play around. And more than the fillers, they have a good product in the pipeline in terms of PDRNs and those other conjugates, which are the new-edge things.

Speaker #1: So, fillers I have now, but the future products are going to be PDRN and exosomes. And also, they have some unique medical devices which help us with the administration of certain specific aesthetic products also.

Speaker #1: So, it's a good collaboration. Plus, they also have two big training centers in the UK as well as in Canada, where a lot of new-edge development of combination treatment of fillers along with GLP-1s and also other things are coming in.

Pranav Choksi: Plus, they also have two big training centers in UK as well as in Canada, where a lot of new age development of combination treatment of fillers along with GLP-1s and also other things are coming in. So that also going to add value to us. So this is what we feel it's a good mix for us.

Speaker #1: So that is also going to add value to us. So this is what we feel is a good mix for us.

Speaker #5: Okay, understood. Just one last question, if I can squeeze it in. I think you spoke in a previous question about SPARSH, that this quarter we took a hit of, let's say, 15–20%.

Bhavya Sonawala: ... Okay, understood. Just a last question, if I can squeeze in. I think you spoke about a previous question about Sparsh that we this quarter took a hit of, let's say, 15-20%, and if you take it on the higher side, that's on a QOQ basis, that's still, you know, 5 to 6% growth. So is there something more to it? Because, you know, we were of the idea that Q3 will show some decent ramp-up, considering tech transfers have started, and then Indore, sorry, Navsari will be free for some exports. So, can you just clarify that?

Speaker #5: And if you take it on the higher side, that's on a few of you. Based on that, it's still 5 to 6 percent growth. So is there something more to it?

Speaker #5: Because we were of the idea that Q3 will show some decent ramp-up considering tech transfers have started, and then Indoor—sorry, Navsari—will be free for some exports.

Speaker #5: So can you just clarify there?

Speaker #1: I didn't understand your question. So, you're saying that 14 to 16 impact was there? I mean, can you repeat your question again? Sorry, I missed it.

Pranav Choksi: I didn't understand your question. So you're saying that 14 to 16 impact was there? I mean, can you repeat your question again? Sorry, I missed it. Maybe I didn't understand. Yeah.

Speaker #1: Maybe I didn't understand. Yeah.

Speaker #5: No, no. So I'm just trying to understand that even if we take the if the 20-crore write-off or the issue that we have and consider that, that was considered as a revenue, that still 5 to 6 percent growth on our previous quarter.

Bhavya Sonawala: No, no. So I'm just, just trying to understand that even if we take the, if the INR 20 crore, write-off or the issue that we have, and consider that, that it, that was considered as a revenue, that's still, 5 to 6%, growth on our previous quarter. And we were of the idea that Q3 will be-

Speaker #5: And we were of the idea that Q3 will be, yeah, Q1, Q2, yeah. And we were of the idea Q3 would be quite better considering the tech transfers happen, and then Navsari is also free for exports.

Pranav Choksi: QIQ.

Bhavya Sonawala: Yeah, Q2. Yeah, and we were of the idea Q3 will be quite better considering this tech transfer happen, and then Navsari is also free for exports. So, just wanted to clarify.

Speaker #5: So, just wanted to clarify it.

Pranav Choksi: Yeah. No, I'll explain. So if you see... I got your question. So if you see Navsari's revenue are mostly saturated at the, you know, 800 mark. And of course, you know, the normal domestic growth which comes, will come. So the additional, if you see the entire growth which has been coming in, is because of the Indore ramping up coming in. So, the expectation of doing 10% or 15% on INR 230 is not what the statement I gave. But yes, definitely I gave that, we would be coming close to that, you know, INR 250 mark. So if you see last year in the same period with, Indore starting in October 2024, from October to December, we had done, I believe, INR 200 or 205 crores.

Speaker #1: I'll explain. So, if you see, I got your question. So, if you see, Navsari's revenue is mostly saturated at the 800 mark. And, of course, the normal domestic growth, which comes, which comes.

Speaker #1: So the additional, if you see, the entire growth which has been coming in is because of the indoor ramping up coming in. So, what the expectation of doing 10% or 15% on 230 is, is not what the statement I gave.

Speaker #1: But yes, definitely, I gave that we would be coming close to that 250 mark. So if you see, last year in the same period, with indoor starting in October 2024, from October to December, we had done, I believe, 200 or 205 crores.

Speaker #1: From there, the revenue year would be almost at a 20% jump. But yes, QNQ, I don't foresee that drastic jump coming in of 10 or 15 percent QNQ.

Pranav Choksi: From there, revenue here would be almost at a 20% jump. But yes, QOQ, I don't foresee that drastic jump coming in of 10, 15% QOQ. But definitely, like I said, overall, as a business, 15 to 20% is what we are foreseeing, because regulations take time, validation batches are still ongoing. Also, you know, there have been a correction of in terms of debtors control this year. So that's why overall, as a package, we feel that this year will be little affected. Next year, again, I think someone pushed me to answer that. I said, yes, minimum 15% what we should look for. But yes, hopefully with other positives kicking in, 20% is what we should aim for, or more. But I think 15% is basically what I give.

Speaker #1: But definitely, like I said, overall, as a business, 15% to 20% is what we are foreseeing because regulations take time. Validation batches are still ongoing.

Speaker #1: Also, there has been a correction of terms of debtors control this year. So that's why, overall, as a package, we feel that this year will be a little affected.

Speaker #1: Next year, again, I think someone pushed me to answer that. I said yes, minimum 15% is what we should look for. But yes, hopefully, with other positives kicking in, 20% is what we should aim for.

Speaker #1: Or more. But I think 15% is basically what I give. But like you said, there are erosions coming in. There might be environmental factors.

Pranav Choksi: But like you said, there are erosions coming in, there might be environmental factors, there might be something else. We don't know how the GLP landscape will also come in. So, I'm keeping... In terms of my word, I'm trying to be a little bit conservative and try to achieve first and then talk more.

Speaker #1: There might be something else. We don't know how the GLP in landscape will also come in. So, in terms of my word, I'm trying to be a little bit conservative and try to achieve first and then talk more.

Speaker #5: Got it, got it. And just to confirm, the audit that happened, that's the same as your GMP, right? Is my understanding correct?

Bhavya Sonawala: Got it. Got it. And this, the audit that happened, that's the same as new GMP, right? Is the understanding correct?

Speaker #1: It was you, GMP only. It was from Portugal. Yes, you, GMP only. Yes.

Pranav Choksi: It was new GMP only. It was from Portugal. Yes, new GMP only. Yes.

Speaker #5: And that allows us, all across Europe, if we— the.

Bhavya Sonawala: That allows us all across Europe.

Speaker #1: It allows your audit—Colombia, South Africa, UK, everything. Yeah. Which is saving in Navsari.

Pranav Choksi: It allows all over Colombia, South Africa, UK, everything, yeah, which is changing on our side.

Speaker #5: Sure, thank you so much. All the best. Thank you.

Bhavya Sonawala: Sure. Thank you so much. All the best. Thank you.

Speaker #1: Thanks.

Speaker #6: Thank you. Ladies and gentlemen, to ask a question, you may press star and one. We have a follow-up question from the line of Aditya Pal from MSA.

Operator: Thank you. Ladies and gentlemen, to ask a question, you may press star and one. We have a follow-up question from the line of Aditya Pal from MSA. Please go ahead.

Speaker #6: Please go ahead.

Speaker #7: Hi. Thank you again for the opportunity. Sir, just wanted to get the numbers of our SBUs and how they've performed year-over-year and quarter-on-quarter. And then you can also maybe segregate how the domestic branded businesses performed.

Aditya Pal: Hi. Thank you again for the opportunity. Sir, just wanted to get the numbers of our SBUs and how they've performed, YOY and QOQ, and then you can also maybe segregate how the domestic branded business performed.

Speaker #1: Sorry, sorry. Can you repeat that, brother? I just missed it because of the network issue.

Pranav Choksi: Sorry, sorry, can you repeat that, brother? I just missed it because of the network issue.

Speaker #7: Sure. Sorry. So what I'm requesting is that if you can also, if you can tell us how the SBUs have performed. That is, domestic branded business, international API, CMO.

Aditya Pal: Yeah, sure. Sorry. So, what I'm requesting is that if you can tell us how the SBUs have performed, that is, domestic branded business, international, API, CMO, and then you can also-

Speaker #7: And then, if you can also perform insights... yeah. And then, you can double-click on the Domestic Branded Business as well—how each sub-SBU has performed in the DBB.

Pranav Choksi: DBB also perform inside?

Aditya Pal: Yeah, and then you can double-click on the domestic branded business as well, how each sub SBU has performed in the DBB.

Speaker #1: Got it. Okay, so coming to the primary divisions, of course, domestic business this year because of this ramp-down, because of these two major divisions of SPARSH and Critical Care.

Pranav Choksi: Got it. Okay. So coming to the primary divisions, of course, domestic business this year, because of this ramp down, because of these two major divisions of Sparsh and Critical Care, we have, we will be growing only at around, maybe, you know, around 8% ±. I'll send you an exact number, hopefully in the next call, but I look at it, I think it's around 8%. The CMO business is more or less the same, because most of the capacity which we have, we are trying to use for the export division. Export division is growing by almost 40%, but the base is less of around INR 120 crore. That's where that thing is there. API is, like I said, most of the APIs which we make are for in-house usage.

Speaker #1: We will be growing only at around, maybe, around 8% plus some. I'll send you an exact number—hopefully in the next call. But if I look at it, I think it's around 8%.

Speaker #1: The CMO business is more or less the same because most of the capacity which we have here, we are trying to use for the export division.

Speaker #1: The export division is growing by almost 40%, but that base is less—around 120. That's where that thing is there. API is, like I said, most of the APIs which we make are for in-house things.

Speaker #1: So, this is where the entire thing is there. After coming now to a deep down of all our domestic business, then the critical care and the sparse, we'll see mostly like a stagnant year this year.

Aditya Pal: Correct.

Pranav Choksi: This is where the entire thing is there. After coming now to a deep dive of all our domestic business, then, you know, the Critical Care and the Sparsh, we'll see mostly like a stagnant year this year. Or maybe, you know, because of all these, I think almost 14 + 5, 19 +, and maybe 3 more, a INR 22 crore, I would say correction would be there this year. Totally, I'm saying even including Q4. So at the end of the Q4, we would be little bit more on the same level as last year, but of course, with a better data profile. Infertility has increased by around 16 to 17%. Botulinum toxin has increased by almost 20 to 25%, but the base is small.

Speaker #1: Or maybe because of all these, I think almost 14 plus 5, 19 plus, and maybe 3 more—a 22 crore, I would say, correction would be there this year.

Speaker #1: Totally, I'm saying, even including Q4. So at the end of Q4, we would be a little bit more on the same level as last year.

Speaker #1: But of course, with the better data profile, infertility has increased by around 16 to 17 percent. Botulinum toxin has increased by almost 20 to 25 percent.

Speaker #1: But the base is small. And our aesthetics—sorry, our Ayurveda and mass marketing—has grown by around 12%. So this is the broad percentage.

Pranav Choksi: Our aesthetics, sorry, our Ayurveda and mass marketing has grown by around 12%. This is the broad percentage.

Speaker #7: No, no. This is very helpful. This is very helpful, thank you so much. And on your strategy of critical care and SPARSH, the domestic branded business, so if I were to look at your data days, how much would it impact the working cap, how would it impact the working capital cycle, and how much would the working capital cycle fall by?

Aditya Pal: No, this is very helpful. This is very helpful. Thank you so much. And on your strategy of critical care and Sparsh, the domestic branded business. So, if I were to look at your debt it is, and how, how much would it impact the working cap, how it would impact the working capital cycle, and how much would the working capital cycle fall by?

Speaker #1: I'll give you that. There are two reasons why we have to be a little bit more cautious in critical care and SPARSH. Firstly, the procurement of the RAM, the testing of the RAM, because these are all sterile materials.

Devkinandan Roonghta: Well, there are two reasons why we have to be a little bit more cautious in critical care and Sparsh. Firstly, the procurement of the RM, the testing of the RM, because these are all sterile materials. The starts-

Devkinandan Roongta: Well, there are two reasons why we have to be a little bit more cautious in critical care and Sparsh. Firstly, the procurement of the RM, the testing of the RM, because these are all sterile materials. The starts-

Speaker #1: The stats, I mean, the entire working capital starts from there. So the RAM testing, the RAM procurement, then the lyophilization process is around 5 to 10 days, depending on the product.

Aditya Pal: Mm-hmm.

Devkinandan Roonghta: I mean, the entire working capital starts from there. So the, you know, the RM testing, the RM procurement, then the lyophilization process is around 5 to 10 days, depending on the product. Then there's a 15-day stability, then there's a transit.

Devkinandan Roongta: I mean, the entire working capital starts from there. So the, you know, the RM testing, the RM procurement, then the lyophilization process is around 5 to 10 days, depending on the product. Then there's a 15-day stability, then there's a transit.

Speaker #1: Then there's a 15-day sterility. Then there's a transit.

Speaker #7: It all depends. I understand the inventory cycle and everything, but because we are tweaking the...

Aditya Pal: No, I understand. I understand the inventory cycle and everything, but because we are tweaking, tweaking the,

Speaker #1: You're saying only for the debtors you're asking?

Devkinandan Roonghta: You're saying, ask for the debtors, you're asking?

Devkinandan Roongta: You're saying, ask for the debtors, you're asking?

Speaker #7: Yeah, only for the debtors, because I just want to understand how it will impact the net working capital. Inventory and all remains the same.

Aditya Pal: Yeah, only for the debtors, because I just want to understand how will it impact the net working capital. Inventory and all remains the same.

Speaker #1: Yeah. No, no. I mean, so right now, because the number of validation batches are increasing—so, I mean, let me answer. I think we are, with the help of the cash flow coming in.

Devkinandan Roonghta: Yes.

Devkinandan Roongta: Yes.

Aditya Pal: No, I think that is what I'm saying.

Devkinandan Roonghta: So right now, because the number of validation batches are increasing in... So actually, let me answer. I think we are, with the help of the cash flow coming in, there is still a lot of cash flow required for ramping up Indore in terms of the new products like daptomycin and others. So for that, we don't want to go for debt, and we want to go for our in-house, what do you call, cash generation only, and that's how we are doing that and taking it from. So-

Devkinandan Roongta: So right now, because the number of validation batches are increasing in... So actually, let me answer. I think we are, with the help of the cash flow coming in, there is still a lot of cash flow required for ramping up Indore in terms of the new products like daptomycin and others. So for that, we don't want to go for debt, and we want to go for our in-house, what do you call, cash generation only, and that's how we are doing that and taking it from. So-

Speaker #1: There's a lot of cash flow required for ramping up indoor, in terms of the new products like daptomycin and others. So, for that, we don't want to go for debt, and we want to go for our in-house, what do you call, cash generation only.

Speaker #1: And that's how we are doing that, and taking it.

Speaker #7: Okay. So when it's a debtor deal, as in, because we are revamping our entire strategy of critical care and SPARSH, we are not giving them so many receivable days.

Aditya Pal: Sir, DSO doesn't, because we are revamping our entire strategy of critical and Sparsh, because we are not giving them so much receivable days, and we want to get our money faster. That is what I've understood from the call.

Speaker #7: And we want to get our money faster. That is what I've understood from the call. So I just want to understand, we were at close to, say, in FY25, we used to get money in 140 days.

Devkinandan Roonghta: Yeah.

Devkinandan Roongta: Yeah.

Aditya Pal: So I just want to understand, we were at close to, say, in FY 25, we used to get money in 140 days. How far-

Speaker #7: How far.

Speaker #1: Okay. The number of days. Sorry, sorry, sorry. I think.

Devkinandan Roonghta: Okay, number of days. Sorry, sorry, sorry, I think.

Devkinandan Roongta: Okay, number of days. Sorry, sorry, sorry, I think.

Speaker #7: Yeah. Yeah.

Aditya Pal: Yeah. Yeah, yeah.

Speaker #1: Okay. I think this question is better for Roomtas and Navik than me, but I'm still trying to answer.

Devkinandan Roonghta: Okay. I think this question is better for Roonghta and Avik than me, but I'm still trying to answer it.

Devkinandan Roongta: Okay. I think this question is better for Roonghta and Avik than me, but I'm still trying to answer it.

Speaker #7: Yeah. Roomtas and Navik can answer.

Aditya Pal: Yeah, Roonghta or Avik can answer.

Speaker #1: Yeah.

Devkinandan Roonghta: Yeah.

Devkinandan Roongta: Yeah.

Speaker #7: Also, I will take this up. So Aditya, as you understand the overall number, the question was only about these receivables—sticky receivables—in SPARS and Critical Care.

Avik Das: So I'll take this up. So, Aditya, as you understand, the overall, the number. The question was only the these receivables, sticky receivables in Sparsh and critical care, and that's the number that he's given. So if you take that number and you find the number of days, you'll get your answer. So overall, the other businesses, it sort of remains the same. And going forward-

Speaker #7: And that's the number that we've given. So if you take that number and you find the number of days, you'll get your answer. So, overall, the other businesses, it sort of remains the same.

Speaker #7: And going forward.

Speaker #1: Actually, let me give him a let me give him a answer, which I hope he likes. Yeah. Okay. Go ahead.

Aditya Pal: Let me give him a, let me give him an answer, which I hope he will like.

Avik Das: I will answer. Sir, I will answer.

Aditya Pal: Yeah, okay, go ahead.

Speaker #7: Last year, our average debtors was around 140 days. And in 2026, we are expecting it should come down to around 120 days.

Avik Das: Last year, our average debtor days was around 140 days, and in 2026, we are expecting it should come down to around 120 days.

Speaker #1: 120 days.

Aditya Pal: 120 days?

Speaker #7: Yeah.

Avik Das: Yeah.

Speaker #1: All right. All right. This answer. This answer. Thank you so much.

Aditya Pal: All right. All right, this answers, this answers. Yeah. Thank you so much.

Speaker #2: Thank you. We have a follow-up question from the line of Vishal Mehta from Oakland Capital. Please go ahead.

Operator: Thank you. We have a follow-up question from the line of Vishal Mehta from Oaklane Capital. Please go ahead.

Vishal Mehta: Hi, sir. Just wanted to check what is the debt number as on date, and how do you plan to reduce this? Say, maybe how or what is the de-leveraging plan over the next two, three years?

Speaker #8: Hi, sir. Just wanted to check, what is the debt number as on date, and how do you plan to reduce this? Say, maybe, what is the deleveraging plan over the next two, three years?

Speaker #1: So presently, we are on two types of loans. One is some loans which have been taken for the indoor plant, and one is for working capital requirements.

Devkinandan Roonghta: So presently we are having two types of loans. One is term loans, which has been taken for Indore plant, and one is working capital requirement. Including both the loans, I can say today it is around INR 375 crores, and it may remain at same level, at least for 2027, and after 2027, it will start come down. Because lot of working capital is required for whenever there is a sales jump over, there is a, for increasing the inventory as well as debtors. So instead of borrowing working capital from the bank, we are making it from internal accruals. Hence, we are not in a position to prepayment the, prepayment of, prepayment the term loan, and we will start prepayment of the term loan from 2028 onwards. So I think the loan will remain at INR 375 crores, but till to March 2027 only.

Devkinandan Roongta: So presently we are having two types of loans. One is term loans, which has been taken for Indore plant, and one is working capital requirement. Including both the loans, I can say today it is around INR 375 crores, and it may remain at same level, at least for 2027, and after 2027, it will start come down. Because lot of working capital is required for whenever there is a sales jump over, there is a, for increasing the inventory as well as debtors. So instead of borrowing working capital from the bank, we are making it from internal accruals. Hence, we are not in a position to prepayment the, prepayment of, prepayment the term loan, and we will start prepayment of the term loan from 2028 onwards. So I think the loan will remain at INR 375 crores, but till to March 2027 only.

Speaker #1: Including both the loans, I can say today it is around ₹375 crores, and it may remain at the same level, at least until 2027.

Speaker #1: And after 2027, it will start to come down. Because a lot of working capital is required for whenever there is a sale jump or there is an increase in the inventory as well as debtors.

Speaker #1: So, instead of borrowing working capital from the bank, we are making from internal approval ahead that we will not be in a position to prepay the prepayment of the term loan.

Speaker #1: And we will start prepayment of the term loan from 2028 onwards. So, I think the loan will remain at 375, but still to March 2027 also.

Speaker #2: Got it. So, sir, depreciation and interest would be at similar levels in Q3 for FY27 as well?

Vishal Mehta: Got it. So, sir, depreciation interest would be at similar levels in Q3 for FY 27 as well?

Speaker #1: It is around 9; it is today, it is around 35 to 36 crores. I think it will be going to remain at the same level next year also.

Devkinandan Roonghta: It is around 9. Today, it is around INR 35 to 36 crores. I think it will going to remain in the same level in next year also.

Devkinandan Roongta: It is around 9. Today, it is around INR 35 to 36 crores. I think it will going to remain in the same level in next year also.

Speaker #2: And same is the case with depreciation as well, sir? Everything is now in the business?

Vishal Mehta: Same as the case with depreciation as well, sir?

Devkinandan Roonghta: Yes.

Devkinandan Roongta: Yes.

Vishal Mehta: Everything is now in the business?

Speaker #1: Yeah. Everything is now.

Devkinandan Roonghta: Yeah, everything is now.

Devkinandan Roongta: Yeah, everything is now.

Speaker #2: Got it. Thank you so much, sir.

Vishal Mehta: Got it. Thank you so much, sir.

Speaker #3: Thank you. Hi, sir. There are no further questions from the participants. I now hand the conference over to Ms. Shweta Shetty for closing comments.

Operator: Thank you. As there are no further questions from the participants, I now hand the conference over to Ms. Shweta Shetty for closing comments.

Speaker #9: Thank you very much for joining us today. If you have any further questions, please feel free to reach out to our Investor Relations team, and we will be happy to address them separately.

Ami Shah: Thank you very much for joining us today. If you have any further questions, please feel free to reach out to our investor relations team, and we will be happy to address them separately. With that, we conclude today's call. Take care.

Speaker #9: With that, we conclude today's call. Take care.

Speaker #3: Thank you. On behalf of Gufic Biosciences Limited, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.

Operator: Thank you. On behalf of Gufic Biosciences Limited, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.

Ami Shah: Thank you.

Q3 2026 Gufic Biosciences Ltd Earnings Call

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