[Video Narrator]: Ladies and gentlemen, you are connected for the Beta Drugs Limited conference call. Please stay connected. This conference will begin shortly. Participants, you are connected for the Beta Drugs Limited conference call. Please stay connected. The conference will begin shortly. Thank you.
Operator: Ladies and gentlemen, good day and welcome to Beta Drugs Limited Q2 and H1 FY27 earnings conference call hosted by Phillip Capital PCG. As a reminder, all participant lines will be in the listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand over to Mr. Sri Surya K. from Phillip Capital PCG desk. Over to you, sir.
Sri Surya: Thank you. A very good afternoon, everyone. On behalf of Phillip Capital Private Client Group, I welcome you to the Q2 and H1 FY27 earnings conference call for Beta Drugs Limited. Joining us today from the management are Mr. Rahul Batra, Chairman and Managing Director, Mr. Ashutosh Shukla, Director of Sales and Marketing, Mr. Nipun Arora, CFO, Mrs. Rajni Brar, CS and Compliance Officer, along with Mr. Natarajan, Head of Strategy. I will now hand over the call to Mr. Rahul Batra for his opening remarks. Following his address, we will open the floor for question and answers. Over to you, sir.
Rahul Batra: Thank you so much. Good afternoon, everyone. On behalf of Beta Drugs family, we wish you all a very happy Diwali. To start with, let me take you to the key financial highlights. The revenue growth of Beta is at 29.2% as compared to H1 FY2026. The EBITDA margin grew by 0.10%, that is from 23.08% to 23.18%. The PAT showed a significant increase from INR 24 crore to INR 34 crore, which is almost 45% growth as compared to H1 of last year. Before going ahead with the key highlights, we want to take you on the brief of the impact of trade margin capping on the MRP. The trade margin capping is nothing, this is which was declared in the year 2019.
Rahul Batra: To give you a brief detail on this, of our total branded business which we did in FY2026 was INR 123 crore. The orals comprise of INR 60 crore in that business which has no impact at all from the recent NPPA guidelines as the majority is being sold through distributors. The injectable business is INR 63 crore out of total business, of which INR 50 crore come from the scheduled drugs whose MRP is already defined by the government so that will not have even a single impact. The INR 13 crore injectable business, which comes under the non-scheduled drug, will also have no impact on our margins and growth as well as realization. The overall impact on the company seems zero or negligible. Now, let us take you to the key highlights of H1 2027.
Rahul Batra: The own branded business have grown by 17% in FY2027 as compared to H1 FY2026.
Rahul Batra: In exports, we have filed 76 new dossiers in different geographies, which include four dossiers filed in Europe. We have started bioequivalence studies with EU RLDs to be filed, in which we have 5.5 products to be filed in regulated markets, of which one is already concluded and the rest are in process. We have successfully launched four new products in FY2027 and on a plan to launch six more in coming months. With the effort and dedication from the sales team, we have successfully made five brands more than INR 5 crore, in which one brand almost touching INR 10 crore sales annually. Beta has finally got a breakthrough in Tata Hospital and we have got their some brands approved in this H1 FY2027. The latest acquisition of Nivian Lifesciences has delivered a strong growth of 75% as compared to H1 FY2026.
Rahul Batra: The API business too has delivered 13% growth in H1 FY2027. Now discussing the businesses vertical-wise. First is own brands. The own brand business showed a growth of 17%, as discussed earlier. The OSD, oral solids forms contribution to the business has increased up to 50% in total business. We have successfully launched four new products and six more to be launched this year. As discussed, we have got successfully our first purchase order from the Tata Hospitals. We are on track to do INR 150 crore sales from our own brands for this FY2027. Coming on to the exports. We have done INR 43 crore of sales in the first half of FY2027, and we are on track to do our target for FY2027.
Rahul Batra: Apart from one opportunity which we had in 2026, where we did some opportunity sales of INR 25 crores and the balance INR 16 crore that came from the territories out of total INR 41 in FY26. We have done more than INR 26 crores apart from the INR 15 crore sales that we have done in FY27. Recently, we have got 35 new registrations and on a verge to get 50 more registrations from this year. We have also successfully cleared the audit of Azerbaijan and filed 20 new dossiers, of which 12 registrations are expected in FY27. We have also filed four dossiers in EU and expected to receive an audit in this financial year only. Total of 872 new registrations are in pipeline, which we will be getting in next two to three years.
Rahul Batra: In export, we are on track and will deliver a major growth in coming next two to three years down the line. Coming on to our latest acquisition, Nivian. Nivian has delivered 75% growth, that is from INR 18 crore to INR 31 crore sales in H1 of FY27. The acceptance of these products has been in the corporate hospital, which is a major increase in this FY. There has been a significant 60% increase in the prescriber base also. The top five brand contributes around 63% of the total sales. At Nivian, we are evaluating to launch our first recombinant in next two to three years. Nivian will continue to deliver a strong growth in this segment. In Derma, we have seen a consistent increase in the secondary sales. The PCPM grew by 30% to reach an average PCPM of INR 2.5 lakhs in this half of FY27.
Rahul Batra: Recently, we have registered and our first consignment is on a way to be delivered for high-end cosmetics from Europe. We have successfully in-licensed some products which will be launched in December 2026 this year. Derma will make a great brand in next two to three year which we are aiming for. The CMO business has grown by 21% in H1 FY27. The NDDS has played a big role in getting new partners. We have successfully partnered with three new Indian giants for the CMO business. The CDMO business will keep up the pace in the future as well. The API business has shown a growth of 29% as compared to H1 last year. With the ongoing investment in the new facility of intermediates, the API business will get a big boost in terms of margins and supply.
Rahul Batra: The key focus on this new investment is to set our presence in the export market with intermediates in-house. The API business have a lot of room and opportunity to grow further. We have scaled up the new products development and will be the first one to launch many molecules as a first generic in India only with the support of API. To conclude, at Beta, we will continue to deliver 20% to 25% growth for next three to five years with a sustained margins between 23% to 24%. We are constantly evaluating biosimilar market. We are looking to tailor it capital efficient strategy for both marketing and manufacturing. We are also evaluating to manufacture oncology medicines outside India, where we already have on the ground presence. Thank you. Now we are looking forward for the questions.
Operator: Thank you very much, sir. We will now begin the question and answer 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 use handsets while asking questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Disha from Sapphire Capital. Go ahead, ma'am.
[Analyst] (Sapphire Capital): Hello? Am I audible, sir?
Operator: Yes, you are audible, ma'am.
[Analyst] (Sapphire Capital): Yes. Thank you so much for this opportunity. Couple of questions, sir. Firstly, congratulations on a good set of results, sir. We have seen our EBITDA margins at around 22%. Going ahead, as you were guiding for around 23% to 24% sort of margins, what do you think will be the key growth driver? For the next year, what sort of margin should we look at given the increasing contribution from the CMO business, the API business, and the Nivian business?
Rahul Batra: Mr. Natarajan, could you answer, please?
[Analyst] (Beta Drugs Limited): Sure. Disha, I think the trend towards increasing margins is going to be aided by a few factors. One is, of course, the change in the mix. If you look at our businesses, our branded businesses have close to 70% gross margins. Our CMO business is closer to 50%, exports is closer to 55% to 60%. As the business mix changes, even without any cost optimization or factoring in other externalities, we believe the EBITDA margin will trend higher. Purely because EBITDA margins also tend to be a function of gross margins, and our gross margins will trend higher. Additionally, as we know that we have set up a backward integrated plant for APIs, which will not just help us file dossiers for geographies like Europe, but also will help us reduce costs, and hence, of course, aid in the expansion of gross margins.
[Analyst] (Beta Drugs Limited): Of course, as the scale of this business goes up, there is a tremendous amount of operating leverage which kicks in. I think the guidance towards 25% EBITDA margins is very conservative keeping in mind the factors that I just listed above.
[Analyst] (Sapphire Capital): Fair enough, sir. Sir, for this H2, we have seen for the oncology business, the growth has been a bit impacted because of the de-bottlenecking that was happening and also because of some supply constraints. What is the update on that? Are we seeing any improvements on ground?
[Analyst] (Beta Drugs Limited): Yes. I think the detailed explanation will be given by Mr. Nipun. I can tell you that the de-bottlenecking exercise is over and we are seeing now optimal production at both the factories. In terms of the growth in the branded onco, we are still sticking to our original guidance of 20% to 22% growth for the whole year. In terms of CMO, I think the growth will be further propelled by the improved supply of Platin APIs, which was impacted. If you look at our Platin sales between H1 of this year and last year, they were pretty much flat in spite of the increase in the prices, primarily because of the API supply constraints. I think overall, all the businesses we maintain our guidance in spite of the branded business delivering a 17% growth.
[Analyst] (Beta Drugs Limited): At an overall level, I think we are comfortably in the range of touching INR 535 plus.
[Analyst] (Sapphire Capital): Fair enough, sir. Sir, on the Nivian side, I just wanted to understand what is the current margin profile for this business. For this year, obviously, we are guiding for 50% growth, but will we be able to continue such high growth going ahead as well? What sort of growth are we looking at for FY28 from this business?
[Analyst] (Beta Drugs Limited): On the margin front, the gross margins are closer to 50% for Nivian. We are yet to see the synergy benefits from Beta flowing in into Nivian. Obviously, there will be an upswing on the gross margin side. On the growth prospect for Nivian, see, it is a very large market and very scattered outside of the top 2. There is plenty of headroom for future growth. As Mr. Rahul was mentioning that we also intend to get into recombinant hormones, which will kind of expand our addressable market to almost twice the size that is today. 30%, 35% growth over the next 2, 3 years is not something outside the realms of possibility.
[Analyst] (Sapphire Capital): What will be the EBITDA margins for this business and once the synergy benefits kick in, where do we expect in that number?
[Analyst] (Beta Drugs Limited): I think today we are closer to 18.5%. With synergy benefits coming in, we should be able to touch 23% to 25%, similar to what we are doing in Beta.
[Analyst] (Sapphire Capital): Sir, for the export also, we guided for a very high growth for the exports. What sort of margin differentials do we see for exports compared to domestic sales? What sort of contribution from exports are we looking at for the next year and for this year?
[Analyst] (Beta Drugs Limited): This year, I think we have guided to closer to between INR 90 crores to INR 100 crores of sales on the export side. FY28, FY29, I think year-wise, giving a growth projection rather than that what we are looking at as export business is something that can deliver closer to about INR 300 odd crores of business over the next three, four years. The reason I do not want to give out an exact guidance is that the export market is purely a tender-driven business. Over a period of three to four years, I can easily deliver a 30%, 35% growth. But sometimes the tenders do slip into from one financial year to another financial year. But on an average, you can expect easily a CAGR of around 30% on this business. Given the base where we are, I think that is an easily achievable target.
Operator: Thank you. Disha, may I request you to please join the queue for the follow-up questions. Ladies and gentlemen, in order to ensure the management is able to address questions from all participants in the conference, please limit your question to two per participant. The next question is from the line of Avnish Burman from Vikarya Investment. Please go ahead, sir.
Avnish Burman: Hi. Good evening. Congratulations on a great set of numbers. Just a couple of questions. Rahul, you mentioned that the CMO side obviously has seen a step jump in quarterly revenues run rate. One contributor is the NDDS product that you had launched. Is it fair to assume that the margins that you make in this NDDS product on your CMO segment, it will be higher than your average CMO margin?
Rahul Batra: Absolutely. For NDDS, we don't share the cost sheets. It is about the new development which we have done. So the EBITDA margin, the gross margins is absolutely much higher what we are right now getting in the other products, especially for this product.
Avnish Burman: Great. Also safe to assume that the future NDDS pipeline that you have, so when obviously they will contribute to the branded business, you are also planning to offer CMO services for the pipeline NDDS products, right?
Rahul Batra: Yes, we will be offering to our own brands, also to CMO business. CMO have been a very integral part of our growth journey, so we will be providing these products to the other partners so that the product quality should come in the market.
Avnish Burman: Right. Okay. This very interesting thing you mentioned about the recombinant products in Nivian. Any timelines or any more color that you can give because this could, like you said, I mean, quite be very big for Nivian.
Rahul Batra: There is one product which is called FSH. So we are in a discussion with one company to develop this product along with the phase III trials. So almost it is on a final stage to start the development and the total timeline to launch this product officially in Indian market will be between 2 to 3 years.
Avnish Burman: Okay, great. Last question, Nivian revenues for FY2026, if you can just give me that number.
Avnish Burman: It was in the range of around INR 43 crores.
Avnish Burman: INR 43 crores for FY26. Thanks, team, and congratulations once again.
Rahul Batra: Thank you.
Operator: Thank you. The next question is from the line of Vinay Lakhera from Ratna Traya Capital. Please go ahead.
Vinay Lakhera: Hi. I had a question on the CMO business. What is the new guidance for the year and what is the state of the Platin business that affected last year's revenue? Hello?
Rahul Batra: Yes, Mr. Natarajan, please.
Vinay Lakhera: Sorry.
[Analyst] (Beta Drugs Limited): We are guiding the CMO business for FY27 in the range of around INR 180 to INR 190 crores.
Vinay Lakhera: INR 180 to INR 190 crores. And-
Vinay Lakhera: There was issues in the Platin business.
[Analyst] (Beta Drugs Limited): Last year.
Vinay Lakhera: Last-
[Analyst] (Beta Drugs Limited): Has that base effect already completely come into the system? Sorry, the audio was not clear. If you can just repeat the question.
Rahul Batra: I will take up, Siddharth. Basically, the Platin, the supply is still a constraint, but still without Platin also we will be able to make up whatever the guidance is.
Vinay Lakhera: Okay. This-
Operator: We have lost the line for the participant. The next question is from the line of Rishi Maheshwari from Axis Capital. Please go ahead.
Rishi Maheshwari: Hi. Thanks for taking my question and congratulations to the management. Just two questions. One is, what is the organic growth rate in branded oncology if I have to exclude the portfolio changes? I am just trying to understand the market share gain over here.
Nipun Arora: Sorry. See, the organic growth rate for the branded oncology business is closer to 20% to 22%, as I had mentioned.
Nipun Arora: The market is always in a state of flux. New products come in, old products go out of flavor. You can't really evaluate the market saying that what would be the existing product's growth rate going forward. Because the market itself is growing at maybe 10%, 15%. And when we are trying to grow at 20%, 22%, we are taking market share from other incumbents. But to say each and every product will grow at the same pace would not be correct. It's a mix of newer products coming into the market. It's a mix of new product innovations, novel formulations, and obviously the volume growth. It won't be fair to put a number on a brand which was introduced in, let's say, 2010, to expect that to grow at the same pace today.
Rishi Maheshwari: My idea was to understand the concentration of revenue also within the domestic branded oncology business. Is there any specific drug which is far more influential versus the others?
Nipun Arora: As Sir Ram was saying that we have one brand which is more than INR 10 crores, out of a total pie of an annualized revenue run rate of INR 150. Clearly the concentration is low. And that's the nature of the market also. Typically, brands do tend to kind of plateau at INR 15 crores, INR 20 crores at best. And therefore it's a basket of products that dictates how successful you are in the branded oncology segment.
Rishi Maheshwari: Fair enough, sir.
Rahul Batra: I will just add up in this. See, just understand there are different types of cancers prevailing in the market which a person gets. So every cancer disease has a different medicine. So there are a lot of medicines depending on the stages of the cancer, depending on the different cancer. So the single product cannot be that larger in particular segment.
Rishi Maheshwari: Sure. I understand that. I appreciate that. On the CMO business, sir, what proportion of the third-party manufacturing revenue is repeat business? How visible are the customer orders for, say, the next year or so?
Rahul Batra: See, we have been doing CDMO business since last 15 years now, and any partner is associated with us, we have never lost him. See, we at Beta are the low-cost manufacturer for anti-cancer medicines, and we are one of the largest. Having two plants only for the manufacturing side, along with the support of API, makes us unique in the market and becomes the preferred choice for any person who is coming into the oncology or any person who wants to shift their production to any plant. So we do not see any issues in the CDMO business. Rather, this business is maintaining its pace and this year we have shown a very positive growth on the CDMO business side.
Operator: Thank you. Rishi, please come back to the queue for the follow-up question. Participants, please limit yourself to two questions per participant. The next question is from the line of Darshil Jhaveri from Crown Capital. Please go ahead.
Darshil Jhaveri: Hello. Thank you so much for taking my question, sir. Firstly, congratulations on a really great set of results, sir. A few of my questions will be more bookkeeping related. I just wanted to understand what is our current cost of debt because I think we have very low debt, around INR 50 crores, but we are paying a quarterly interest of more than INR 2 crores. Could you help me with the cost of debt that we have, sir?
Nipun Arora: Hi, Dashil. Our cost of debt generally varies between 8% to 9%. If you are comparing last year's cost of debt, last year there were convertible debentures on which an interest of close to 7.5% we used to pay. Now that has gone because those convertible debentures were converted into equity early this year.
Darshil Jhaveri: Okay. Sustainably, I think we would have very lower cost of debt. That will be lesser hitting the booth because even in September-
Nipun Arora: Yeah.
Darshil Jhaveri: Yeah.
Nipun Arora: Yeah. We have lower cost of debt as of now because you must have seen that PAT margin is increased mainly because of the cost of debt reduction only, the debt which was there in the form of debentures.
Darshil Jhaveri: Correct, sir. Just another question from my end, sir. I think most of our segments are guiding for more than 25% growth. Overall, can we say that your guidance of 20% to 25% growth is slightly on the conservative side, sir? Because the way we are growing, I think we can easily beat that year-on-year also. And sir, EBITDA margin that we are guiding are including other income or excluding, sir?
Nipun Arora: Let me address the growth part. Yes, the guidance is on the conservative side. We would prefer to keep it that way. The idea is to underpromise and overdeliver. On the margin front, the reported margins that we have kind of disclosed include the other income. The EBITDA includes other income.
Darshil Jhaveri: If we exclude the other income, then the margin is 22%, and if we include other income, then margin is 23.18%.
Operator: Thank you. The next question is from the line of Anubhav Mukherjee from Prescient Capital. Please go ahead.
Anubhav Mukherjee: Congrats on a very good set of numbers. Sir, I have some basic questions as I started tracking the company only for some time. How does the receivable days differ for the different business segments we are in?
Nipun Arora: Basically what happens is our total days receivable is 116 days as of now, which used to be 113 days in 31 March 2026. CDMO business, generally, we have a credit period of 75 to 90 days. In branded business, we have a credit period of 60 to 70 days. In export, generally, we go for either advance payment or LC payment. In Nivian also, this is again like branded only, so 70 days would be Nivian. But yes, there are some institutional debtors which are public institution debtors. So that takes sometimes much of a time, close to 100, 120 days.
Anubhav Mukherjee: Okay, and these institutional debtors are mostly for the branded business?
Nipun Arora: Yeah, for the branded business. For the tender business and tender branded business.
Anubhav Mukherjee: Okay. Sir, and Pramar. Okay. Over the last three, four years, even with the increasing export and branded business, our receivable days have increased. Is this because of more tender business, or what is driving this?
Nipun Arora: See, our volume is also increased. If you see, only 3 days are increased. From 113 days it has changed to 116 days. This is a very negligible increase.
Rahul Batra: I will give you insight on this. Nivian, let me take up. Basically, the total branded business which we are targeting this year is around INR 150 odd crores. Out of which the total institution business we are targeting, that is around INR 20, 25 crores. For government business, the payments, they do commit that the payments will come in 90 days or 120 days, but most of the time it crosses 6 months. That is why these receivables are way bigger. Otherwise, the government payments will never die. The government payments do come on the due time. But sometimes some governments do not have their budgets allotted for the payments. And that part of business is not big in terms in the branded.
Rahul Batra: That is only around INR 20, 25 crores from the total of INR 150 crores, which we are doing in the trade market.
Operator: Thank you. The next question is from the line of Bhavika Singhvi from Niveshaay. Please go ahead.
Bhavika Singhvi: Hello, am I audible?
Operator: Yes, ma'am.
Bhavika Singhvi: Yeah. Thank you so much for the opportunity. Sir, the first question I have is on the Platin side. In the Q4 call, last year, you mentioned that you have muted the domestic Platin business, but are expecting to continue the export side. But in Q1, you indicated that because of the realization and net price increase, will improve. Just wanted to understand how we see the Platin business going forward. Do we expect it to grow? Because I think this H1 has been flat, despite the price rise because of, I think, API availability. So how we see the Platin business going forward, like for FY 2027 and even FY like going forward in one, two years, if you can answer that. The second question I have is on the own brand growth.
Bhavika Singhvi: Basically, what I can see is that in Q2, there has been a flat and I think in the last call it has been mentioned that there has been a temporary shutdown. Just wanted to understand how much that has impacted and what are the other reasons for this flat growth. What we can expect a run rate going forward in H2 for us to be able to achieve the target which we are aiming, the INR 150 crores. If you can explain these two questions to me.
Rahul Batra: Sure. The Platin business, I will explain to you, and regarding the branded sales growth, Mr. Ashutosh Shukla will take up this question. For Platins, generally we are not concentrating on the Platin business. The reason is the availability of the API. We do have orders in hand. We do have an order book for these Platins, but since the manufacturers are very less in India, there are one or two manufacturers who are manufacturing Platins. So we are not depending our growth on the Platin. Sometimes the requirement is for 5,000 vials. We are just feeding the market with 1,000 vials or 1,500 vials for that particular product. This is how we are managing the Platin thing. For export, we do have an opportunity for Platins where we do not have to rely on the Indian manufacturers.
Rahul Batra: We can always import for export purpose on advanced license basis. That will be taken care. Yes, Platin business, overall it was flat this half, but you will see some growth in the next half of this year. For the Yes.
Bhavika Singhvi: Yeah. Just to follow up on this, we are not planning to discontinue the Platin business because I think the cap which has been increased is going to become normal in December this year. Just wanted to understand how we see, because I think last to last quarter, we were a little skeptical because of the price and all costing and all. Just want to understand. Also, we had our Platin as a part of our CMO business as well. What is currently like our Are we just focused on export or is it also a part of our CMO business?
Rahul Batra: No, it will be a part of all the business verticals, Platin. But yes, if the requirement is for 10,000, so we will be delivering 3,000, 4,000, so the market should not be dry, so that we should be available in the market with these brands also. And yes, the Platin business, you will see some growth in the next half. The only reason we are doing Platins is it has been supported by the government by increasing the MRPs. Since the MRPs has been increased, so the realization is much better as we used to do earlier in the previous year. So now the only issue left is the availability of these Platins.
Rahul Batra: So we are from our side trying our best to source Platins at a best price and trying to get a delivery at a good time so that we can feed our current order book in both CMO and branded business. Now coming on to the question of the flat growth of Q2 for our own branded business. Ashutosh, can you please take up this?
Ashutosh Shukla: Yes, sir. Good evening. As was mentioned by Mr. Natarajan, there was a temporary shutdown of the plant because of the de-bottlenecking exercise. So around INR 6 to 7 crore sales got impacted and shifted for H2. If you see H2 sales of last financial year, we did business of around INR 62 crore. And in this H2 we are expecting business of INR 80 crore. So all put together, H1 plus H2 in this financial year we will be closing sales close to INR 150 crore, which is roughly around more than 20% growth.
Operator: Thank you. Ladies and gentlemen, you may press star and 1 for asking question. The next question is from the line of Axay Shah from VVD Asset Managers. Please go ahead.
Axay Shah: Thank you for the opportunity and congratulations for the good set of numbers. Sir, we have acquired the land for R&D purpose. In the last con call, we said that we are going to dispose it off, but it is not showing in asset held for sale. Are we going to use it for any other purpose? If it is-
Rahul Batra: No.
Axay Shah: For what purpose? Yeah.
Rahul Batra: We are not using it for any other purpose. Rather, we will be disposing it off. We are just finding a correct price to dispose it off. Maybe another six months or one year since we have paid already and it is in the assets, so we do not want to sell it off in a less margin. We are just waiting it off to be disposed of at a good price.
Axay Shah: Okay. Sir, I joined a little late, so it may be a repetitive question, but your H1 growth in export is not that much encouraging and you have reduced your growth guidance to 30% from 50%. What are the challenges there and how are we overcoming it?
Rahul Batra: Export last year in H1 2026, we did INR 41 crores. What happened in last year, we got an opportunity sales of one single order of INR 25 crore from one country. This year we did not get, otherwise if you could see the total sales which we are doing regularly in all the countries globally, we did only INR 16 crores. But this year without opportunity sales, that opportunity sale which we did not get this year, from INR 16 we went up to INR 43 crore. There is a consistent growth in the export business. Moreover, we have not guided like 30%, as Mr. Natarajan also said, that we will not guide low, but we want to deliver better. As I told earlier that there are 872 new registrations which are in pipeline which we are yet to get in coming two to three years.
Rahul Batra: Out of which we will get some 50 registrations in this year only. The export guidance, although we have given less, but 100% the export will be delivering more growth in coming years.
Operator: Thank you. The next question is from the line of Smit Doshi from Okane Capital. Please go ahead.
Smit Doshi: Yeah. Am I audible?
Operator: Yes, sir.
Smit Doshi: Yeah. In your opening commentary you have mentioned two things. First is with regards to biosimilar market evaluation.
Bhavika Singhvi: Sir, sorry, you are not audible.
Smit Doshi: Yeah, 1 minute. Am I audible? Hello.
Operator: Sir, can you please come a little closer and speak?
Smit Doshi: Yeah. Actually, in your opening remarks, there are two things mentioned. First is with regards to biosimilar partner market evaluation and secondly is with regards to oncology manufacturing outside of India. Can you please throw some more color on this for better understanding?
Rahul Batra: Yeah. Mr. Natarajan, can you please?
[Analyst] (Beta Drugs Limited): Yes. See on the biosimilar front, the idea is to evaluate opportunities for manufacturing and marketing where our capital outlay is not high. As you understand, biosimilar as a business requires a very high capital commitment upfront and the gestation periods are very long. So our view is that we would want to take a business model which does not require capital commitment or rather limits our capital commitment upfront. And over a period of time as the business gets established, we kind of double down on that business. So that is what Mr. Rahul mentioned that we are looking for a capital efficient model to get into biosimilars. And we are obviously evaluating multiple opportunities on that front. On your second question, see, there are certain countries which are our focus geographies which we have constantly maintained in our investor communication as well.
[Analyst] (Beta Drugs Limited): including LATAM, North Africa, Middle East, APAC. Some of these countries are very large addressable markets where we have a very strong distributor relationship. We may want to establish a manufacturing footprint in some of these geographies, because as the world moves towards localization, we believe that catering to these opportunities would require some kind of a local presence.
Smit Doshi: Okay. Would it be a greenfield or any acquisition or something like that?
[Analyst] (Beta Drugs Limited): It is going to be customized basis the country and the opportunity. It would be difficult to give a very blanket response to that.
Operator: Thank you. The next question is from the line of Vamsi Krishna, a retail investor. Please go ahead.
[Analyst]: Yeah. Hope I'm audible.
Operator: Yes, sir, you're audible.
[Analyst]: Yeah. Hi. Beyond the company's existing growth plans, what's the next major strategic bet for Beta Drugs that could transform the business beyond financial year 2030? Maybe be it into therapeutics or complex oncology products capabilities as such.
Rahul Batra: I think, yeah, that is what we spelt out. We are evaluating opportunities to get into biosimilars and other complex oncology businesses. Obviously, those will take time. So those will be a strategic roadmap even beyond 2030.
[Analyst]: Mm-hmm. Thank you.
Operator: Thank you. Participants, you may press star and 1 in order to ask a question. Next question is from the line of Bhavika Singhvi from Niveshaay. Please go ahead.
Bhavika Singhvi: Hello, am I audible?
Operator: Yes, ma'am, you're audible.
Bhavika Singhvi: Yeah. So, sir, just from exports, I wanted to understand how much has been the Forex impact this quarter we have seen. Also, just wanted to understand how much growth has come from the volume and the realization driven, if you can make me understand that.
Rahul Batra: Basically, what happens is we import also and we export also. So we import raw materials from China in Adley Lab, and we export in Beta Drugs and Adley Formulation. What happens is that we got a positive edge over here because when the dollars go up, we are getting the remittance higher amount. So our foreign exchange fluctuation is on a positive side, close to 3 or 4 lakhs. If I go precisely, it is 2.5 lakhs rather.
Bhavika Singhvi: Okay. And sir, also want to know the update of the EU GMP audit, which we are expecting to happen this month. So, what is the status of it? Because I think in the last call, as you mentioned that it will happen once the dossier will be filed, and I think we have done with the dossier. So just wanted to understand on that.
Rahul Batra: See, we have been giving this information in the market that we are expecting EU maybe this quarter. But to be very honest, we have been following it up very aggressively with the EU auditors. Earlier, there was a line inspection which used to happen in India. So without dossier, they used to come and inspect the plant. But now there are new changes that they want the product dossier to be filed in Europe so that they can come and inspect the plant. To do that, we had to do some product development as per the EU basis. We are already done with that. We have already filed four dossiers for different clients. Now we are expecting a letter very soon. Maybe it can happen in the next 2 months, 3 months, 4 months. So we are expecting an audit very soon from EU.
Bhavika Singhvi: Okay. And sir, also I can see in the PPT that there has been mention of one API CapEx additional happening. Can you throw some light on it, like what we are doing with that particular CapEx?
Rahul Batra: API right now what we were manufacturing only the APIs, and we used to do it from different stages. To further strengthen it, we are coming up with new plant that is for intermediates. The intermediate we used to procure from China. We just want to be self-reliant and produce those intermediates in India itself. This is how the API is shaping up. So right from intermediates till API till finished formulations, we just want to do everything in-house comprehensively. The major investment has gone to the new intermediate plant which will be like what we are used to taking it from China, we want to manufacture in India only. Before the plant starts, we are already done with some research development part, and we have developed 20 odd intermediates for different APIs, which we will manufacture in that plant in next coming 2 to 3 months.
Operator: Thank you. The next question is from the line of Avnish Tiwari from Vikarya Investment. Please go ahead.
Avnish Tiwari: Hi, Rahul. Maybe if you could draw something on what happened in 2019 when prices for the end consumers sort of came down for onco drugs and maybe how did your margins shape up, but also how did your volume, was there any elasticity that lower pricing at the end could increase the affordability in tier 2, tier 3 towns and hospitals so you can protect your pricing, but as a result did you see volumes also shoot up because of that?
Rahul Batra: Sure. You are absolutely correct. There are 2 types of MRPs which are prevailing. 2 types of things which are prevailing by NPPA. One is the price fixation by the government that are called the scheduled drugs. One is, which has just come out, that the price has to be fixed by the manufacturer from first point of sales. It is the same thing which happened in 2019, where we revised our MRPs, and from there onwards, we have been maintaining the same amount of gap in our products. That is why there also, we didn't see any impact on our margins and our realization. The same thing has come in 2026, where we see, actually, on our realization and on margin, there will be no impact. Simultaneously, even if, in our total business, 50% is our orals business.
Rahul Batra: Orals, even though the MRP goes down, these products are not being sold from corporate hospitals. These are being sold directly from the distributors. Even if the MRP goes down, the realization will remain the same. The patient will be getting the benefit out of it.
Avnish Tiwari: Right. I guess more patients can afford this, so overall that should help grow the oncology volumes, let's call it this way, which will be beneficial to you eventually because your pricing and margins are same.
Rahul Batra: Absolutely. Being one of the largest manufacturer, we've seen some good side that we might get some benefit out of this new law, new thing which has come into the market by the government.
Avnish Tiwari: Great. Thank you. Bless you. Wish you the best.
Rahul Batra: Thank you.
Operator: Thank you. The next question is from the line of Ajay Surya from Niveshaay. Please go ahead.
Ajay Surya: Thanks for the opportunity. Sir, I am pretty new to the company, so just wanted to understand on the growth strategy. Sir, for example, we have grown almost 30% this H1, but when I maybe remove the Nivian acquisition which we did. So on a like-to-like basis, the growth is pretty much subdued on a 15% basis. Just wanted to understand for maybe this year and our FY2030 vision of maybe of potentially INR 1,000 crores, can you give us some quantitative growth, like splitting how much of that will be organic, branded oncology exports, or the CMO, API, Derma, and the Nivian part? Also, sir, maybe just want to understand because in last couple of years, there have been few external risks which have affected the business.
Ajay Surya: So like Platin API availability has remained a bit concerned or strained, also the capping which has affected the business. Also now institutional revenues are taking a bigger portion, so how can that affect working capital? Also, sir, exports, as far as I understand from the call, are more tender-driven. Also a lot of registrations are still pending. So what portion of export growth is supported by confirmed order versus expected registration and tenders which are pending, and only once they get approved, then only maybe export growth can come in. So just wanted to get more clarity on the growth plan from you.
[Analyst] (Beta Drugs Limited): Thanks. See, in the interest of everybody's time, we had released a document after our 2026 results in which we had kind of laid out our Vision 2030, and I think that articulates how each of these businesses are going to drive growth. I will sincerely request if you can go through it. Happy to address any questions once you've gone through that material. But overall, we believe the key growth engines for Beta would continue to be our branded business, our exports. When I say branded, I also include Nivian in that. Nivian will, of course, deliver a much faster growth. Our branded onco, as I said, we guide for a 20% to 25% growth rate over the medium term.
[Analyst] (Beta Drugs Limited): Our exports business will have an exponential growth, primarily driven, as you rightly mentioned, through the commercialization of products as and when they get approved. So that's the basic framework of how we see achieving the INR 1,000 crores. In terms of specifics, I'm happy to address your questions once you've gone through the document.
Operator: Thank you. The next question is from the line of Kumar Saurabh from Scientific Investing. Please go ahead.
Kumar Saurabh: Hello. Sir, my question is on Nivian. I think we had done 66% acquisition. Do you have any plans of acquiring the rest of the stake? Also, if you can highlight a little bit about how this growth has been achieved. I think we have tried to penetrate in corporate hospitals, and we have got an entry. But you have also mentioned 60% of prescriber base has been covered till now. So if you can talk a little bit about the Nivian growth, how this has come and what we are planning, and do we plan to buy the remaining stake given it is a business which is doing very well for us.
[Analyst] (Beta Drugs Limited): I will address the second part first, which is the growth part. The growth has been primarily through deeper penetration. I think increased prescription of our products. As you rightly mentioned, getting empaneled in multiple corporate IVF chains. Just like oncology, IVF is moving more and more into organized IVF chains, so therefore getting empaneled in those chains becomes a very critical driver. If you see that most of our brands have delivered a very stellar growth. So the growth is completely organic, coming from the brands which are now getting recognized by the prescribers. Of course, we do plan to launch a few products in the next H2 of the fiscal, which will also add to the growth. Second part is, if you look at the addressable market that Nigin caters to today, it would be in the range of about INR 1,500 to INR 1,800 crores.
[Analyst] (Beta Drugs Limited): Given our size, I think there is plenty of headroom for future growth, both through higher prescription and also through increased coverage. In terms of the plan to acquire the remaining 33 odd percentage, I think that is open-ended. One of the reasons we acquired Nigin because we were getting a very phenomenal team which had worked in the IVF industry for close to two decades. The idea was to retain them, and to retain them, I think the best way was to give them equity in the business that they are building.
Kumar Saurabh: Great, sir. Thanks for a great quarter because I think last three quarters there were a few turbulent times and as you had told last time, we are expecting a good event and it has come. Just one last question, sir, on this whole margin capping, the whole oncology capping. I was there on the call and what I understand is it is not going to have any major impact. But I hope you are taking care of all the scenarios where there could be a back and forth from the hospital side or on the distributor side. In spite of that, the way our portfolio is distributed, we are not going to see major impact on the margin. I hope that is a fair assessment.
Rahul Batra: We are taking care of entire compliance on the NPPA front and will ensure that our realizations are not being disturbed.
Kumar Saurabh: Great. Wish you all the best, sir. Thanks a lot.
Rahul Batra: Thank you.
Operator: Thank you. The next question is from the line of Bhavika Singhvi from Niveshaay. Please go ahead.
Bhavika Singhvi: Hello, am I audible? Hello? Hello, am I audible?
Operator: Yes, ma'am.
Bhavika Singhvi: Just a follow-up on the previous question I asked. The reason I ask about the CapEx on the intermediate side because I think in the last few calls you have mentioned about the KSM CapEx which we were planning to do. We have also bought an existing plant for about INR 9 crores and did an investment of INR 15, 17 crores and now we are mentioning about intermediate. Just wanted to understand that these two are different or this is like one plant which we were talking about. Also if you can share what total CapEx is also expected, are we also planning to do CapEx going forward for the same facility?
Bhavika Singhvi: Also wanted to understand on the API revenue side, from the current run rate, do we expect a spike in that, in the growth in that or we assume that it will sustain like what we are doing currently? This is one of the question and the second question I have on the CMO business. You mentioned about the NDDS which we are doing and you said that it has been helping us in our CMO business. Just also wanted to understand as we are now focusing more on the own brand, how much we see the NDDS product going in the own brand and what are the current revenue we are doing from the NDDS like this quarter, how much we did from the NDDS product, if you can share that information. That's all.
Rahul Batra: Taking up all the questions will be very difficult now and we have already mentioned about the NDDS thing. On the API front we can brief you that yes it's the same plant which we have been talking about, the KSM and intermediate is same word. It's the same plant we have done investment and this plant will be starting live by December or January. Almost the entire machinery is in place. We are just doing some qualifications and some approvals are yet to come from the department. This plant will be live by January 2027. Coming on to the API business growth. Till now we have been selling API in Indian market. There have been lot of market since we have got the plant audited from COFEPRIS for API also we are expecting the approval to come in next 1 or 2 months.
Rahul Batra: Once we get so our plant is also the API plant will be PIC/S approved. This will open up many opportunities to supply API in different countries overseas as well. The opportunity there, this business has not been even tagged and has not been even covered by us till now. The opportunity is big and to further enhance the opportunity we are coming up with intermediate so that we should have a proper DMF available. DMF and ASMF available within us. Tomorrow if an audit comes we can get both the plants audited for the intermediates for KSM and for the API. The opportunity is huge.
Bhavika Singhvi: Thank you.
[Analyst] (Beta Drugs Limited): Just a quick interjection for everyone who's tracking the company newly they can reach out to Valorem Advisors who are our IR firm and they will help you connect with us to address your questions.
Operator: Thank you sir. Ladies and gentlemen, we will take this as the last question for today. I now hand over to Mr. Rahul Batra for closing comments. Over to you sir.
Rahul Batra: Thank you. Thank you all for attending our con call. We at Beta will continue to deliver 20%, 25% growth. Along with it, we will keep on evaluating different opportunities coming on the way on the oncology side, whether it is biosimilars or production in different countries. We want to be at the top of manufacturing and marketing oncology medicines in India and overseas. Thank you.
Operator: Thank you. On behalf of Beta Drugs Limited and Phillip Capital PCG, that concludes this conference. Thank you for joining us and you may now disconnect your lines.
Rahul Batra: Thank you.
Bhavika Singhvi: Thank you.
Kumar Saurabh: Thank you.
