Laurus Labs Limited — Call Transcript 2025

Ladies and gentlemen, good day, and welcome to the Q1 FY 'twenty six Earnings Conference Call of Laurus Lab hosted by DAM Capital. As a reminder, all participant lines will be in a listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Please note that this conference is being recorded. I now hand the conference over to mister Nitin Agarwal from DAM Capital. Thank you, and over to you, sir. Hi. Thanks, Afti. Hi. Good afternoon, everyone, and a very good evening, And welcome to Lotus Labs q one f twenty six earnings call posted by Dan Kaplan Advisors Limited. On the call today, we have representing Lotus Labs management, doctor Satinarayan Shahar, founder and CEO, mister Ravi Kumar and mister executive director and CFO, and mister Vivek Kumar, AVP, investor relations. I hand over the call to doctor Shahwa to make the opening comments, and we'll open the floor for questions. Please go ahead, sir. Good afternoon to all our stakeholders. Your company made healthy progress to start the financial year with increasing contribution from CDMO business and continued advancement of our pipeline with big pharma. We're moving ahead with strong focus on commercial execution, realizing the full potential from mid and late stage pipeline programs and rapidly enhancing our service capabilities to meet complex needs of our customers and drive future value creation for our stakeholders. We announced three major capacity expansions during the quarter one. First one, microbial fermentation Phase one greenfield project at WiSAK second one, gene therapy and antibody drug conjugate GMP facility at Shamir Pate and third one, finished formulation facility in Hyderabad under the Karka joint venture. These investments will create more opportunities for growth and further strengthen our ongoing commitment of being a strong manufacturing partner on some of the new technology platforms at scale. Moving on to our financial results. Our Q1 performance was in line with our expectations with revenues of $15.70 crores, reflecting robust demand for our CDMO offerings and continued growth in the formulation business. Gross margins further expanded and are at 59% range and EBITDA margins expanded by 10.5 percentage points to close to 25%, following better operating leverage, product and segment mix. As we look forward, we remain confident in our outlook for improved growth in the rest of the year. To begin, I'd like to share key updates on our CDMO business. We are seeing a very good progress in this division with sustained demand in our high value integrated offerings. We achieved very strong growth for the Q1, registering a sales of crores. This growth was mainly driven by several mid to late stage MCE deliveries and the increase in sales from new manufacturing assets. Pipeline momentum was healthy across clinical commercial phase with the mix shifting to more increased big pharma projects. In specific, a lot of customer interest seen around biocatalysis, flow chemistry, high energy chemistry, controls manufacturing, peptide manufacturing, etcetera. As on date, we have a pipeline of over 110 active projects, over 90 in human health and about 20 in animal health and craft sciences. We continue to invest in our capabilities and commercial offerings in line with what market needs. Accordingly, additional capacity buildup is in progress, particularly in relation to complex molecules, including peptides. When it comes to Larabio, our large molecule CDMO division, this division reported subdued Q1 sales now for INR29 crores, which was flat year on year. The sales impacted from customer specific scale up challenges. However, we remain focused on building strong diversified pipeline across segment and customers. We have few potential long term partnerships under discussion with the new and existing CDMO partners, utilizing enzyme engineering platform. As we discussed, construction work for the commercial scale fermentation facility in YZ commenced in this quarter. The plan is to create over 400 kilonewton capacity in Phase one, which is expected to go online by the end of twenty twenty three. We believe the new site will further accelerate on high quality CDMO service capability and growing our industry solution. In generics, the division reported a growth of 12% and achieved a sales of crores. This was mainly supported by volume expansion in both ARV and developed market sales. We are also seeing the execution of contracts signed last year, which helped the improvement in our capacity utilization. On filings, we filed over 90 DMS till date and also one dose here filed in formulations and three approved received in Q1. Cumulatively, we have filed AGI products. Overall demand outlook largely stable in generics business. Our focus continued on rebalancing the generic R and D and manufacturing resources, mainly to enhance product pipeline and meeting the delivery commitment. On R and D front, overall R and D spending to sales in Q1 was at 4.3%, which is about INR68 crores for the Q1, which was increased by about 6% year on year. The expenditure including our spend on C6, challenge in tariff. The R and D spend is in line with our full year target and we continue to invest in portfolio with product specific approach based on complexity and scale economy. Besides activating the adaptation of sustainable technology. Let me share brief on quality. In Q1, the company underwent close to 39 quality audits by multiple regulatory as well as key customers. Company has successfully passed audit inspections without any critical findings. In summary, our technology platform commercial performance today continues to enable meaningful advancement of pipeline projects as well as business development opportunities. We remain confident in our strategic direction and commitment as a source of value creation now and well into the future. With that, I would like to hand it over to Ravi to share some financial highlights. Thank you, doctor, and very warm welcome to everyone for this quarter one FY 'twenty six earnings call. Total income from operations is INR $15.70 crores with a growth of 31% year on year, and the momentum has come from the CDMO and the generic division business. Gross margin maintained very healthy, 59%, which is more than 4% due to better product mix and process improvement effort. Apart from that, raw material price improvement also. EBITDA per quarter one stands at three eighty nine growth with a margin of 25%, progressively improved versus full year for FY 'twenty five. Profit after tax for quarter one is $1.63 growth. Growth is stand at 13%, but of course, the continued CapEx investment, which has not improved. So it has improved by 3% for versus FY 'twenty five. On the CapEx trend, we invest close to two sixty five growth for the quarter. Our net debt stood at $2,003.08 88 growth with a debt EBITDA of 1.8 versus 2.3 for the last quarter. On the capital allocation front, our strategy remains unchanged, and we'll continue prioritizing this month into high value business segments to drive near and long term growth and returns for our shareholders. You can refer our IR presentation for more details. With this, I would request the moderator to open the lines for Q and A. Thank you. Thank you very much, sir. We will now begin the question and answer session. Participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Bharat from Quest for Value. Please go ahead. Yeah. Hi. First, I'd like to congratulate Bhakti Satya and Ravi for bearing good set of numbers. And I'd also like to especially congratulate Krishna Chitanya for bearing exceptional CDMO numbers consistently from past few quarters. And coming to my question, so there is a significant jump of gross margin this quarter. It increased by around 500 basis points. We are now at 59.5%. Can we expect this kind of high gross margins will be maintained in future too as the share of CDMO increases? Or do you see it as a one off and it's too early to expect this kind of high gross margin? Thanks, sir. You see, if you look at our gross margins over several quarters, we're always informing and also maintaining around 52%. Now we can say as the contribution from CDMO business increases, we expect the gross margins will remain between 55% to 60%. That's what we expect in the coming quarters. Okay. Thanks. And if you see of the past trends, CDMO in q one is generally weaker. And as year passes by, q two will be better and q three will be much better and q four will be the top. Yeah. And generally, phase two will be much better than h one. But this time, subsequently, if you see CDMO in q one is very, very strong. It is even better than last year's q four. Yeah. So on this date, do you still think h two will be better than h one for CDMO in FY twenty six two? The CDMO business, you can't count quarter on quarter, but we expect good growth over last year for sure. Our manufacturing and delivery depends on their clinical programs. So it it will be bumpy, but we we see we are in a good shape right now on our CDMO segment. Okay. Good. Thanks. And my last question is that, currently, if you see the current cycle of Global Fund tender, which is for generally for three years, it is going to end, I think, if I'm not wrong, it will be going to end by December, end of this year in December. Yeah? May I know if Lotus has won the next tender cycle? Generally, they will run the tender little later, end of maybe September, October. See, if you see our tender, we are very successful in getting good share of that tender, and we don't see any challenges there. Okay. Yes. Thank you. Thank you very much. All the best. Yes. Thank you. Thank you. The next question is from the line of Jeevan Patwa from Sahasar Capital. Please go ahead. Sir, firstly, congratulations for entire team actually for, you know so whatever hardware we have put in in last few years, I think that has started showing the results. I'm very happy for it. Only question I have is on the bio side, so on the food putting side. So we are basically, you know, about to set up facility for, you know, 2,000,000 liter and then 4,000,000 liter. So on the food putting side, what is the progress, sir? Are we now started putting any work there? Are we reactors has been orders has been placed for the reactor? Where are we in that? As I mentioned, given, we are installing 400 kilonewton liters of fermentation capacity in Wijac Greenfield project. That's the Phase one. As you mentioned, overall capacity at that site will go to 2,000,000 liters in two phase two more phases. In phase two, phase three put together, it will go to 2,000,000 liters. And we have very good visibility about utilization of that fermentation site, which product, which customer and all. Like we are gaining confidence and gaining visibility in our small molecule CDMO segment. We're also seeing a lot of visibility now, what customer, what project, what price, what time line and our large molecule CDM. As you were talking about our focus on food protein, food proteins we are focusing, but focus as also on other proteins, cosmetic proteins, some polymers produced by fermentation. So the offerings are becoming very interesting, which are also Wonderful, sir. Wonderful, sir. And second question I have is on the Immuno Ads. So how do you see the ramp up in, you know, number of so capacity, I understand, will come on stream by twenty September. But in terms of the response from the market, I just wanted to understand your feedback on that. How is the response from the market? Are we also seeing a foreign national traveling to India to get this treatment done? In India, since the cost is much lower. There are some more treatments offered to foreigners. That was based on the hospital's child. What is also happening, we are also trying to build overseas presence by entering partnership with some big pharma in those regions. Maybe in the near future, we'll give you more details on our global expansion of CAR T therapy using Immunat. Okay. Great, sir. Great. And third, last is on the gene therapy, sir. So we are setting up a viral vector facility in Kanpur. Right? So so any any update there, sir? So there is a change in our approach because our thought process changed from 2,500 square meter facility to 6,000 square meter facility. So there is no space available at Technopark in Kanpur. So we have moved idea of that facility to Hyderabad, Genome Valley, where we have broke the ground for a 6,000 square meter facility. And whatever gene therapy, viral vector and also drug building houses, antibody drug conjugate GMP facility as well. So because we have added another therapy ADC, we start to move to Hyderabad. Okay. Okay, sir. Thanks a lot. Thanks a lot. The next question is from the line of Rahul, an individual investor. Please go ahead. Hey, thank you for the opportunity and congratulations on the great set of numbers. But, Shala, if you can possibly paint a picture for us, you know, with over the last five years, we've kind of come a long way. And the product mix has changed, and now we see the CDM revenue contributing to 30 plus percent. Last, you know, probably five years ago, it was less than 10%. At this point, we see the contribution from the biodiesel to be less than 5%. How do you see this product mix changing, you know, five years out and what what is the vision of the company over there? If if you can, you know, share a bit on that, I'd be interested in the listing. We while we continue to focus on our core, which is APIs and integrated offerings in generics, we are also increasing our investments, CapEx, resources and technology platforms to offer wide variety of services for late clinical and commercial human health, animal health and crop science programs. As we've mentioned, currently, the CDMO contributes over 30% of our revenue. We expect this will continue to grow. We have in the near future, near to medium to the future, we expect it has a potential to touch 50%. So that's our guesstimate. Thank you so much. Like just a hypothetical question, at any point in time, do you see these decisions becoming, you know, big to the extent that, you know, the the there may be a possibility of listing these as, you know, separate entities and business? We don't have any plans for that. Okay. Thank you so much, wish you all the good luck. Thank you. Thank you. The next question is from the line of Chirag Shah from White Pine Investment. Please go ahead. Please offer the opportunity. Congratulations on good set of numbers. My first question is on gross margins that we have seen. Would it be right to assume that the gross margin improvement is driven by non CD four business significantly or largely? Because CDMO gross margins would largely be taking a range. Right? Maybe 5% deviation here and there. So would it be a right statement to meet that the sharp increment in gross margin over last six, seven quarters that let's see is driven by a non P and L business, and it would be now almost closer to what we were three years back. If you look at our quarter on quarter performance, our revenue decline came from ARVs and other generic, whereas there was a growth from CDMO. So I think these two contributed the gross margin expansion. But, sir, what is the right statement that in gross margin in CDMO, your gross margin would reasonably be stable irrespective of the stage of project, whether it's an early stage or late stage, or it materially varies gross margins from the state of the project that you are You are right. The generally, the gross margins remain similar. That's the proper stage and scale of the project. It's okay. That one. That really answered my question. So and, sir, then in that case, which part of the non CDMO business has been contributing to margin? Because if I do some mathematics, sir, there is a significant improvement of almost 700 to a thousand bits in non series glass margin. So is it the ARV part or SDF part which is driving or or is it in the shed from, like It's majority came from non ARV. Majority came from non And is that further scope of improvement was there? Or rather, what is driving that on ARV performance? Based on some shipments, as I mentioned, we expect the gross margins remain between 55 to 60. Earlier, we used to say around 55. Now we are saying it will be 55 to 60%. So that's very healthy, and we expect we'll be able to maintain that. Sir, one last question. Any pre buying that you have witnessed or any indication of pre buying given the potential risk of some tariff that could come across? So is there any pre buying that you have witnessed from your customers? I think it's very difficult question to get an answer because we have to wait. And as you have seen from our results, see, our dependency on formulation sales to U. S. Are not that significant. Yes. Yes. Great. Thanks, guys. Thank you. The next question is from the line of Tushar Panudhani from financial services. Please go ahead. Am I audible? Yes. Very well. Sir, just on how that, you know, the animal health facility is commissioned, even agrochemical. So has this contributed meaningfully for the CDMO business for the quarter? Or the other way to ask is, if you could break the CDMO business into human health, animal health and the agrochemical and increase? The contributions from human health and animal health were there in this quarter, nothing significant from cost sciences in this quarter. Will that come up in the coming quarters? Is that the same assumption or it would take some more time to or the security for for that segment? We expect meaningful revenues from craft centers will only come next financial year. So just no different. Is it a similar chemistry and hence, it's just a different application or how to think about it, specifically for next five to six years? The facilities for animal health are segregated and dedicated. You can't use that for human health or craft science. Similarly, the craft science facilities are also segregated and dedicated. So those can be used for only craft sciences. So interchangeability of these two facilities are not possible. Whereas human health, we have large capacity where we can do these projects in multiple sites at multiple scales. Understood, sir. And just lastly on bio side, where there has been certain issues with the customer. So probably, if that customer comes back or if you have new customers, like can there be timeline approximately for this business to sort of revise? There is no challenge. It's only delay. The project now the bottleneck was resolved, things are back to normal. And we don't see when we look at the entire year, we don't see any big challenge achieving what numbers we thought at the beginning of the year. Thank you. The next question is from the line of from Antifragile Thinking. Please go ahead. Yes. Many thanks for taking my questions. Doctor, progress update you can share regarding the Villo Bio and AI driven bioengineering platform partnership we are progressing with, I mean, what advantages does bioengineering provide over chemical, you know, conventional chemical synthesis in terms of efficiency cost and sustainability, please? This is what programs we are working with Willow using the AI driven engineering platform, primarily hydroxylation platform. Adding Hydroxy, Bruchsan, Stera Azerul backbone, that's the one we are working. There are multiple programs. Maybe in this financial year, one program will go from lab to pilot mode. And we expect two more programs in the next financial year. And and do we expect the learnings out of this program to be kind of integrated into some of our future ventures? I mean, because bio is a very emerging promising area, we we are just exploring the possibility of the iceberg. Our partnership with Billow is primarily meant for steroids and arsenals, where I got the who don't our our Bengal team is doing development, whereas Billo is doing research. I think they are identified the enzyme and then they give it to Bengal team for optimization. So they're working very that partnership is working well. And we we currently, we are not intending to use that technology on any other program right now. Understood. And thank you for that. Ramiti, this new CapEx investment of over 5,000 crores that we have announced in Andhra Pradesh, I guess, will be executed over multiple phases and years. So, and if my assumption is correct, can we therefore anticipate maintaining a healthy net debt to EBITDA ratio despite this massive growth CapEx? Yes. As we indicated before, we are going to invest INR 5,000 crores in the next five year time. I think cash flows, internal cash flows will sufficient to take care of it. As we indicate, we don't make our debt net debt is more than 50% of our revenue in any point of time. Sure. Sure. And finally, in the context of Trump's Make in America, a big pharma is investing heavily in biologics, gene therapies, rate laws, drugs, even diagnostics, and and more to expand, you know, capacity and strengthen their supply chain. So and and many of them from Roche to AstraZeneca to Eli Lilly, almost all of them have announced, you know, multi billion dollar CapEx in The US. So how will these investments by innovators in The US affect the outsourcing and CDMO industry? These big pharmas have very large pipeline. Maybe part of the supply chain will be located in U. S, part of the supply chain located outside. We have to see how it evolves. Everybody is announcing a lot of investments in U. S. We don't see a beginning of impact. So as we mentioned, they will not move core chemistry to U. S. They will move cell and gene therapy, finishing steps. Though the demand for intermediates will remain constant or increasing maybe. And maybe small molecules API as well, that's not going to move to US. Yeah. That's what we believe. Yeah. Right. Yeah. Yeah. Sure. Sure. That's all from my side. Thank you. Thank you so much. Thank you. Thank you. The next question is from the line of Vivek, an individual investor. Please go ahead. Good evening, sir. I have a question regarding the large buyer, sir. You have mentioned that there is a pricing challenge in that particular site in for the large buyer. Could you please share the details on the pricing challenge? And and the second question is that, what can be the how big it can become in next five to ten years at large buyer sales? See, the pricing challenge at Bio pertains to hiring reactor months to product billing. So that was the one shift happened. Because in the clinical not clinical trial, since we don't know how many days fermentation will take, how many days the downstream processing happens. So customer is to pay per month or per batch. Once the product stabilizes, then they will the billing will go to per kg. So that's the pricing shift happening for them when the product mature. The question regarding the opportunities in the next five years, we see significant potential. That is the reason we are investing a lot of money in greenfield projects. As we mentioned, the Phase one itself, we are exceeding 400 kiloliters capacity and eventually it will go to 2,000,000 liters of fermentation capacity. Okay, sir. Thank you for answering the question, sir. I'll join in the queue, sir. Thank you. The next question is from the line of Abhijit, an individual investor. Please go ahead. Mister Abhijit, your line has been unmuted. Please go ahead with your question. Yeah. Am I audible? Audible, Abhijit. Yeah. Great set of numbers. I have a question with regards to the FBS. If you can see on a quarterly basis, there's been a reduction. Is this the volatility in these numbers have been there for the last four quarters in the presentation. So is this going to continue? Is there any stability that is going to be there in the generic FBS and generic portfolio? That's one question. The majority delta in our sales in FDF is coming from how many millions of packs of anti retroviral we're shipping in the quarter. So overall, we're shipping the same number, but depending on the approvals from various countries to ship logistics and all, revenue recognition, because most of them are fee shipments. So those are the factors contributing to the variation in the generic formulation sales. Okay. My next question is with regards to this crazy move that everybody is making in India and globally about peptides and the opportunity for GLP-one and weight loss drugs basically and also other peptide products. Is there any opportunity that is available for LORUS also in this case? We believe so. Okay. You you don't wanna go more further about it? Yeah. I mean, you don't want to disclose, I guess. Is that Yeah. Is that correct? Okay. Yes. Thank you. Thank you. Thank you. You. The next question is from the line of Pankaj Mahajan from Shantam Wealth. Please go ahead. Sir, congrats for a good set of number. Sir, can I get a breakup of this 5,000 crore CapEx? How much is going for the CDMO over the next five years? No, we are not disclose that. It will interchange based on the business opportunity. Okay. Thank you, sir. Thanks for the call. The next question is from the line of Vishal from Motilal Resolve. Please go ahead. Sir, just a housekeeping question on this AirView business, if you could do breakup of formulation and. Yes. Just give me one minute. We'll give you the API. Yeah. We API is $3.63 crores and formulation is $2.84. About 640 crores, both the API and formulations could do that. $3.60 and $2.80. Okay. So now for this one, ARV formulation, you know, we've seen a bit moderate run rate over past, so this is process if you could We are expanding our capacity for non ARV formulations and which will be qualified by end of this year. So we can expect non ARV formulations to grow from Q4 onwards. But on the product approval side also there has been a bit, correct me if I'm wrong. Not our revenue growth primarily comes from contract manufacturing of integrated formulations, both API and FDF. So once the capacity, we were doing tech transfers. Once the capacity is qualified, we don't see lag in revenues. Got it. Thanks very much. Thank you. The next question is from the line of from Investment. Please go ahead. Yes, sir. Thanks for the opportunity again. And sir, apologies. I'm going back to the gross margin point. So on the non ARV side, would it be a right statement that we are almost at the peak gross margins that we had in the past around 2021? On the non CDMO aggregate gross margin, which could be a function of which, I'm not going to do those details, but non CDMO gross gross margin would be closer to the peak maybe of a '21 or '22 that we had. Yeah. Yeah. I mean, it's it's a difficult, it may be maybe closer. We are we are we are right. Maybe closer. We had a very good gross margin. I'll I'll put it that way. So Yeah. So my so my actual question is, so what are we doing from here on to improve that part, that piece of gross margin for that business? As we grow our CDMO business, as we see, today, we haven't achieved operational efficiency, still a lot of unutilized capacities and all. As we grow our revenues, we are not going to grow our R and D and quality staff proportionately. We are going to increase other expenditure proportionately. If you look at when our revenue was net, cost of employees went up to 17%. It is sometimes it was down 10%. So we have a we are at the beginning of that benefit of Operational. Operational efficiency. Yeah. Once we improve revenues, our percentage of expenditure will come down. So that is another metric which will help us to improve our numbers, EBITDA as well as return on capital. Sir, my question was more on the non CDMO gross margin. Is that is that non is that business mix changing that it can see a significant uptick from what was the historical peak on the gross margin? Because that will directly flow to EBITDA and factor also in that sense. So is the business model changing where we can see a higher peak gross margin in non CDMO peak? Adi, there is no business mix change. There's only product change. In some products, we get more margins. Maybe we might have shifted in this quarter. So it is fundamentally the business is not changing Okay, great. Thank you and all the best. Thank you. Thank you. The next question is from the line of Nitin Agarwal from DAM Capital. Please go ahead. Mister, thanks for taking the question. Doctor, on, you know, on the the CMO business which we have in both API and formulations, can you give us some color on, you know, we've not you know, when do you see momentum picking up on those pieces? Because it seems sudden flattening out of the API business in the formulation business, except the others also not seem to pick up much over the last few quarters. It will pick up from q four onwards, Nitin. Yeah. And this is driven by certain specific contracts or, you know, what will what will drive the timing from Q4 onwards on this on this? Right now, the tech transfer batches are going on in formulations. And capacity enhancement is also going on permanently. So both we expect will be handy to get higher supplies and higher revenue from Q4 onwards. And just for the APIs? API, what is happening with that contract, we are doing more integrated. So we are doing making API and converting that into formulations. So we may not have we don't expect under the contract manufacturing or API revenues will grow. We'll not grow to the extent formulations are growing. Got it. And sir, on the API business, ex of the ARVs, last year, we had a bit of a slump in the oncology part, I mean, till the time you were disclosing that. I mean, how do we see the non ARV API fees going forward? Are we seeing momentum coming in that business at some point in time? Not in the next few quarters. And then what is the reason because of which there is there has been some challenge on this piece over the last? It's not a challenge. It's that by size actually. The reason is we have allocated more resources to take up more CDMO projects in front of allocating to significant number to generic API development. So we took that as a decision made by internal people. I think we are also expanding our R and D strength. Once that is done, we will put resources back in development validation of generic API. We also need capacity to do that. So there are multiple things. So right now, we made an informed decision internally to allocate resources to CDMO projects. Okay. That makes sense. And then on the CDMO business, I think the question was asked earlier also. So because even you've had three very strong consecutive quarters of the business, you know, the growth has come through sequentially for the last few quarters on a q o q basis. Now on this basis, how should we think about quarterly growth for for this business? Is it is it gonna be linear or we expect some lumpiness as we go forward? The overall, yes, we can comment. It's going to be healthy growth. Okay. And there's probably some volatility on a on a q o q basis as we go through the quarter. We are not expanding that because of ARVs, some business we know very clear. See, it's not that we will get an order for CDMO in July and we deliver in September. It's not that. So it's a long term. We know very clear what molecule we're making, how much we're making, which is the customer or price and all, pretty well for this year. So we see comfortable and we expect good growth in CDM revenues overall for the year. And sir, if you can on on the on the CDM apart, many products are we supplying? How many have got I guess, this is the commercial supply at this point of time. And typically, should we think about typically, given your pipeline, how many new products can get commercial typically on annual basis given a pipeline over the next couple of years? It's it's difficult. We we we don't want to get that number and confuse all the investors. So I think as we have you have mentioned, we have grown significantly in CDMO quarter on quarter for the last five quarters. And numbers only will speak. That's what we we don't want to forecast our partner products. So when it comes here, we are telling we'll be around INR 2,500 crores plus RMA 200 crores. We have visibility there. In CMO and generic, we have visibility. In CDMO, we don't want to get and give a number. Got it. And then in your opening last one on this on your opening comments, you made a few references to the fact that a lot of big pharma contracts are supplied has started or are scaling up, you know, for our CDMO business. I mean, so, sir, is this so if you can just probably set on the so, sir, when you highlight the big pharma part, know, how how should one read it? Is it essentially leading to larger contracts or or or these are more strategic partnerships? And Nitin Nitin, I think we are going I think it's late in the we cannot disclose more than what we have done on the yeah. Okay, Sure. No problem. Thank you, sir. Thank you. Thank you. The next question is from the line of from Bank of Varota. Please go ahead. Mister, your line has been unmuted. Please go ahead with your question. Yeah. Thank you for the opportunity, and congratulations on a very good set of numbers. There was one comment made on the CDMO side, which is very big that the contribution is now 30% of the sales, and we expect it to touch 50%. So can you give some more clarity on I mean, by when can we expect this kind of contribution to come in from CDMO? No. We mentioned we have the potential to go there, and we are not attaching any year to that. Okay. Yeah. Yeah. But, like, somewhere in five years down the line, can we extend this kind of potential run rate? We're we're not giving any forecast there. Okay. And secondly, on the ADC front, we have mentioned couple of times that we endeavor to go into the ADC side also. So may I ask which part of the ADC are we looking at? Is it the payloads, linkers, bioconjugation? Any color on that? We already make payloads and linkers, and we don't want to make maps. We'll do conjugation, purification and fill finish. That's the infrastructure resources we are building. Internally, we'll make payloads, linkers and then do bioconjugation, purification and fill finish. We will not make math. Okay. Got it. And out of this 5,000 crore CapEx that we have announced, would it be possible to give some color there, like how much of it would go towards the ADC side? ADC is will invite this new 5,000 CapEx is in WiZac. None of that CapEx will go to ADC side. Okay. Got it. Thank you. Thank you. Thank you. The next question is from the line of Gaurav from Antique Stockbroking. Please go ahead. Yeah. Hi. Hi. Thank you. Doctor, good evening. This quarter, we've seen a significant jump in your employee expenses, almost 23%, 21% quarter on quarter, year on year. Any nonrecurring expenses here or this is the new base? The part is nonrecurring. In the sense, once in a year you will get, actually we are giving a long term service awards for the people who stayed us for a longer period. And of course, there is an increment over the last year, last quarter, that's also reflected apart from the additional manpower. So quarter on quarter, we may see some decline in Q2, right, from this I don't say decline, but it will not have that kind of an increase. We're also expanding our team strength. So we keep on recruiting more and more to our expanded base. So it will maybe you can consider that as a new norm maybe. It. Thank you. On the ARV side, we've seen, you know, growth this quarter, year on year growth in this quarter, but you're still maintaining your guidance of, you know, no growth for an overall full year basis. Any particular reason, you know, why still you're not seeing growth in this segment for the full year? Is it just uncertainty on the global tender? We kept some margin, see. We have seen significant price drop in ARVs. If there is no price drop, we may go little bit better. If there is a price drop, our incremental volumes will compensate the price drop. So we are keeping that cushion when we are committing 25 INR plus or minus INR 200 crores. That's the reason we kept that to delta. Mr. Gaurav, does that answer your question? Hello? It must be dropped off. Yes, sir. We'll move on to the next question. It's from the line of Yashir. Please go ahead. Greetings, sir. You know, what like some qualitative inputs in terms of CDMO business? Is it large volume sort of chronic drug? Is it are they in the rare or orphan space? Secondly, also, what could be our mix between, say, big pharma and small biotech on the CDMO business? We can't give you therapeutic mix of our CDMO revenue. Yes. But the majority of revenues are coming from medium and big pharma, very less from small and virtual biotechs. And if you're not audible, Are we the primary source in these cases or are we like, you know, are these projects where, you know, big pharma customers want to diversify the supply and we are probably a a second source, you know, any sort of pricing that could be helpful? I think those insights are very difficult to divert. I'm sorry. No. No. No worries. Ten months to your entire deal. Thank you. Thank you. Yeah. The next question is from the line of Abhijit, an individual investor. Please go ahead. Yes. Thank you for the second round of opportunity. I have a question with regards to the debt. So the net debt for EBITDA right now is 1.8. Obviously, it's come down because your EBITDA has gone up. What is the management's guidance for the debt over the next two years or next three years? We are not expecting significant increase in the debt. So we will manage in the as we said, we try to manage with 50% of our revenue levels, the annual revenue levels. That means EBITDA, debt by EBITDA maybe two, two point five is max. Okay. So two, two point five is the maximum net EBITDA to debt levels. But the INR 5,000 crores that you're going to plan to do in the I presume, next three to four years. Right? You will not do it overnight. It will take three to four years. Four to five. Four to you're going to okay. Four to five years, you are going what is the breakup? Like, are you going to do internal accruals or you're planning to do more JVs with other minor companies or you want to do mostly everything yourself? Mostly mostly for the from the Laureus Lab side and majority of funding will be through internal approvals. Okay. And another question is with regards to the business strategy. Are you looking at more opportunity because of this tariff tantrum that is happening around in The U. S? I know that Lotus does not have a large amount of exposure to The U. S. Market directly apart from the generics. In the other premium more, I would say, complex drug products, is there any opportunity that is coming about? Are there any meetings going on with the large companies? No. No. Okay. Thank you. Thank you. Best of luck. Thank you. Thank you. The next question is from the line of Gavan Tareja from ASK Investment Managers. Please go ahead. Good evening. Hi. Hope I'm audible. Yes, you're audible. Yes. Sir, the first question is on the CDMO piece. Is it possible to understand within CDMO revenue breakdown in terms of what is coming from commercial supplies and what is coming from Phase one, Phase two, Phase three? And how that will evolve over the next two, three years? We are not dissecting those numbers into commercial Phase III, Phase II, Phase I and customers. That's we can't divulge customer and product. So afraid we can't give you that data. Okay. So, okay, the second question is, as the percentage of CDMO in your total sales sizes and since CDMO is a higher gross margin business for you, is it reasonable to assume that it will have, you know, it will take the aggregate or average margin, overall margin or trajectory of the company upward? Yes. The contribution and percentage from CDMO gross, we expect both gross margin and EBITDA margins should continue to go up. Alright. And sir, final one is, on the ARVs, Lena Capraveer and Cavotekawir both have issued voluntary licenses. Even WHO today now seems to stand very strongly behind bringing in lanacapavir, advocating for lanacapavir as as probably the preferred treatment and bringing it in in the emerging markets as well via the voluntary license route. So first question is, would LORUS have an opportunity in lenacaparib? Are not part of the licensee of lenacaparib. And lamacopril will be part of the guidelines for prevention rather than the treatment. That's one. And cabotegravir, delpivirine, we have developed API, and we have a few partners using our APIs. Lanka, we are not part of the licensee. Okay. Okay. Thank you, sir. I'll get back in the queue. Thanks for taking my question. Thank you. Ladies and gentlemen, that was the last question for today's conference call. I now hand the conference over to the management for their closing comments. Thank you, Nitin and DAM team for working this Q1 investor conference call. And thanks for asking very pertinent questions, all the stakeholders. Thank you. Thank you. Thank you. On behalf of DAM Capital, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.

Speaker 1: Ladies and gentlemen, good day, and welcome to the Q1 FY 'twenty six Earnings Conference Call of Laurus Lab hosted by DAM Capital. As a reminder, all participant lines will be in a listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Please note that this conference is being recorded. I now hand the conference over to mister Nitin Agarwal from DAM Capital. Thank you, and over to you, sir. Ladies and gentlemen, good day, and welcome to the Q1 FY 'twenty six Earnings Conference Call of Laurus Lab hosted by DAM Capital. ladies and gentlemen good day and welcome to the q1 fy 'twenty six earnings conference call of laurus lab hosted by dam capital As a reminder, all participant lines will be in a listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. as a reminder all participant lines will be in a listen only mode and there will be an opportunity for you to ask questions after the presentation concludes Please note that this conference is being recorded. please note that this conference is being recorded I now hand the conference over to mister Nitin Agarwal from DAM Capital. i now hand the conference over to mister nitin agarwal from dam capital Thank you, and over to you, sir. thank you and over to you sir

Speaker 2: Hi. Thanks, Afti. Hi. Good afternoon, everyone, and a very good evening, And welcome to Lotus Labs q one f twenty six earnings call posted by Dan Kaplan Advisors Limited. On the call today, we have representing Lotus Labs management, doctor Satinarayan Shahar, founder and CEO, mister Ravi Kumar and mister executive director and CFO, and mister Vivek Kumar, AVP, investor relations. Hi. hi Thanks, Afti. thanks afti Hi. hi Good afternoon, everyone, and a very good evening, And welcome to Lotus Labs q one f twenty six earnings call posted by Dan Kaplan Advisors Limited. good afternoon everyone and a very good evening and welcome to lotus labs q one f twenty six earnings call posted by dan kaplan advisors limited On the call today, we have representing Lotus Labs management, doctor Satinarayan Shahar, founder and CEO, mister Ravi Kumar and mister executive director and CFO, and mister Vivek Kumar, AVP, investor relations. on the call today we have representing lotus labs management doctor satinarayan shahar founder and ceo mister ravi kumar and mister executive director and cfo and mister vivek kumar avp investor relations I hand over the call to doctor Shahwa to make the opening comments, and we'll open the floor for questions. Please go ahead, sir. I hand over the call to doctor Shahwa to make the opening comments, and we'll open the floor for questions. i hand over the call to doctor shahwa to make the opening comments and we'll open the floor for questions Please go ahead, sir. please go ahead sir

Speaker 3: Good afternoon to all our stakeholders. Your company made healthy progress to start the financial year with increasing contribution from CDMO business and continued advancement of our pipeline with big pharma. We're moving ahead with strong focus on commercial execution, realizing the full potential from mid and late stage pipeline programs and rapidly enhancing our service capabilities to meet complex needs of our customers and drive future value creation for our stakeholders. Good afternoon to all our stakeholders. good afternoon to all our stakeholders Your company made healthy progress to start the financial year with increasing contribution from CDMO business and continued advancement of our pipeline with big pharma. your company made healthy progress to start the financial year with increasing contribution from cdmo business and continued advancement of our pipeline with big pharma We're moving ahead with strong focus on commercial execution, realizing the full potential from mid and late stage pipeline programs and rapidly enhancing our service capabilities to meet complex needs of our customers and drive future value creation for our stakeholders. we're moving ahead with strong focus on commercial execution realizing the full potential from mid and late stage pipeline programs and rapidly enhancing our service capabilities to meet complex needs of our customers and drive future value creation for our stakeholders We announced three major capacity expansions during the quarter one. First one, microbial fermentation Phase one greenfield project at WiSAK second one, gene therapy and antibody drug conjugate GMP facility at Shamir Pate and third one, finished formulation facility in Hyderabad under the Karka joint venture. These investments will create more opportunities for growth and further strengthen our ongoing commitment of being a strong manufacturing partner on some of the new technology platforms at scale. Moving on to our financial results. Our Q1 performance was in line with our expectations with revenues of $15.70 crores, reflecting robust demand for our CDMO offerings and continued growth in the formulation business. We announced three major capacity expansions during the quarter one. we announced three major capacity expansions during the quarter one First one, microbial fermentation Phase one greenfield project at WiSAK second one, gene therapy and antibody drug conjugate GMP facility at Shamir Pate and third one, finished formulation facility in Hyderabad under the Karka joint venture. first one microbial fermentation phase one greenfield project at wisak second one gene therapy and antibody drug conjugate gmp facility at shamir pate and third one finished formulation facility in hyderabad under the karka joint venture These investments will create more opportunities for growth and further strengthen our ongoing commitment of being a strong manufacturing partner on some of the new technology platforms at scale. these investments will create more opportunities for growth and further strengthen our ongoing commitment of being a strong manufacturing partner on some of the new technology platforms at scale Moving on to our financial results. moving on to our financial results Our Q1 performance was in line with our expectations with revenues of $15.70 crores, reflecting robust demand for our CDMO offerings and continued growth in the formulation business. our q1 performance was in line with our expectations with revenues of $15.70 crores reflecting robust demand for our cdmo offerings and continued growth in the formulation business Gross margins further expanded and are at 59% range and EBITDA margins expanded by 10.5 percentage points to close to 25%, following better operating leverage, product and segment mix. As we look forward, we remain confident in our outlook for improved growth in the rest of the year. To begin, I'd like to share key updates on our CDMO business. We are seeing a very good progress in this division with sustained demand in our high value integrated offerings. We achieved very strong growth for the Q1, registering a sales of crores. Gross margins further expanded and are at 59% range and EBITDA margins expanded by 10.5 percentage points to close to 25%, following better operating leverage, product and segment mix. gross margins further expanded and are at 59% range and ebitda margins expanded by 10.5 percentage points to close to 25% following better operating leverage product and segment mix As we look forward, we remain confident in our outlook for improved growth in the rest of the year. as we look forward we remain confident in our outlook for improved growth in the rest of the year To begin, I'd like to share key updates on our CDMO business. to begin i'd like to share key updates on our cdmo business We are seeing a very good progress in this division with sustained demand in our high value integrated offerings. we are seeing a very good progress in this division with sustained demand in our high value integrated offerings We achieved very strong growth for the Q1, registering a sales of crores. we achieved very strong growth for the q1 registering a sales of crores This growth was mainly driven by several mid to late stage MCE deliveries and the increase in sales from new manufacturing assets. Pipeline momentum was healthy across clinical commercial phase with the mix shifting to more increased big pharma projects. In specific, a lot of customer interest seen around biocatalysis, flow chemistry, high energy chemistry, controls manufacturing, peptide manufacturing, etcetera. As on date, we have a pipeline of over 110 active projects, over 90 in human health and about 20 in animal health and craft sciences. We continue to invest in our capabilities and commercial offerings in line with what market needs. This growth was mainly driven by several mid to late stage MCE deliveries and the increase in sales from new manufacturing assets. this growth was mainly driven by several mid to late stage mce deliveries and the increase in sales from new manufacturing assets Pipeline momentum was healthy across clinical commercial phase with the mix shifting to more increased big pharma projects. pipeline momentum was healthy across clinical commercial phase with the mix shifting to more increased big pharma projects In specific, a lot of customer interest seen around biocatalysis, flow chemistry, high energy chemistry, controls manufacturing, peptide manufacturing, etcetera. in specific a lot of customer interest seen around biocatalysis flow chemistry high energy chemistry controls manufacturing peptide manufacturing etcetera As on date, we have a pipeline of over 110 active projects, over 90 in human health and about 20 in animal health and craft sciences. as on date we have a pipeline of over 110 active projects over 90 in human health and about 20 in animal health and craft sciences We continue to invest in our capabilities and commercial offerings in line with what market needs. we continue to invest in our capabilities and commercial offerings in line with what market needs Accordingly, additional capacity buildup is in progress, particularly in relation to complex molecules, including peptides. When it comes to Larabio, our large molecule CDMO division, this division reported subdued Q1 sales now for INR29 crores, which was flat year on year. The sales impacted from customer specific scale up challenges. However, we remain focused on building strong diversified pipeline across segment and customers. We have few potential long term partnerships under discussion with the new and existing CDMO partners, utilizing enzyme engineering platform. Accordingly, additional capacity buildup is in progress, particularly in relation to complex molecules, including peptides. accordingly additional capacity buildup is in progress particularly in relation to complex molecules including peptides When it comes to Larabio, our large molecule CDMO division, this division reported subdued Q1 sales now for INR29 crores, which was flat year on year. when it comes to larabio our large molecule cdmo division this division reported subdued q1 sales now for inr29 crores which was flat year on year The sales impacted from customer specific scale up challenges. the sales impacted from customer specific scale up challenges However, we remain focused on building strong diversified pipeline across segment and customers. however we remain focused on building strong diversified pipeline across segment and customers We have few potential long term partnerships under discussion with the new and existing CDMO partners, utilizing enzyme engineering platform. we have few potential long term partnerships under discussion with the new and existing cdmo partners utilizing enzyme engineering platform As we discussed, construction work for the commercial scale fermentation facility in YZ commenced in this quarter. The plan is to create over 400 kilonewton capacity in Phase one, which is expected to go online by the end of twenty twenty three. We believe the new site will further accelerate on high quality CDMO service capability and growing our industry solution. In generics, the division reported a growth of 12% and achieved a sales of crores. This was mainly supported by volume expansion in both ARV and developed market sales. As we discussed, construction work for the commercial scale fermentation facility in YZ commenced in this quarter. as we discussed construction work for the commercial scale fermentation facility in yz commenced in this quarter The plan is to create over 400 kilonewton capacity in Phase one, which is expected to go online by the end of twenty twenty three. the plan is to create over 400 kilonewton capacity in phase one which is expected to go online by the end of twenty twenty three We believe the new site will further accelerate on high quality CDMO service capability and growing our industry solution. we believe the new site will further accelerate on high quality cdmo service capability and growing our industry solution In generics, the division reported a growth of 12% and achieved a sales of crores. in generics the division reported a growth of 12% and achieved a sales of crores This was mainly supported by volume expansion in both ARV and developed market sales. this was mainly supported by volume expansion in both arv and developed market sales We are also seeing the execution of contracts signed last year, which helped the improvement in our capacity utilization. On filings, we filed over 90 DMS till date and also one dose here filed in formulations and three approved received in Q1. Cumulatively, we have filed AGI products. Overall demand outlook largely stable in generics business. Our focus continued on rebalancing the generic R and D and manufacturing resources, mainly to enhance product pipeline and meeting the delivery commitment. We are also seeing the execution of contracts signed last year, which helped the improvement in our capacity utilization. we are also seeing the execution of contracts signed last year which helped the improvement in our capacity utilization On filings, we filed over 90 DMS till date and also one dose here filed in formulations and three approved received in Q1. on filings we filed over 90 dms till date and also one dose here filed in formulations and three approved received in q1 Cumulatively, we have filed AGI products. cumulatively we have filed agi products Overall demand outlook largely stable in generics business. overall demand outlook largely stable in generics business Our focus continued on rebalancing the generic R and D and manufacturing resources, mainly to enhance product pipeline and meeting the delivery commitment. our focus continued on rebalancing the generic r and d and manufacturing resources mainly to enhance product pipeline and meeting the delivery commitment On R and D front, overall R and D spending to sales in Q1 was at 4.3%, which is about INR68 crores for the Q1, which was increased by about 6% year on year. The expenditure including our spend on C6, challenge in tariff. The R and D spend is in line with our full year target and we continue to invest in portfolio with product specific approach based on complexity and scale economy. Besides activating the adaptation of sustainable technology. Let me share brief on quality. On R and D front, overall R and D spending to sales in Q1 was at 4.3%, which is about INR68 crores for the Q1, which was increased by about 6% year on year. on r and d front overall r and d spending to sales in q1 was at 4.3% which is about inr68 crores for the q1 which was increased by about 6% year on year The expenditure including our spend on C6, challenge in tariff. the expenditure including our spend on c6 challenge in tariff The R and D spend is in line with our full year target and we continue to invest in portfolio with product specific approach based on complexity and scale economy. the r and d spend is in line with our full year target and we continue to invest in portfolio with product specific approach based on complexity and scale economy Besides activating the adaptation of sustainable technology. besides activating the adaptation of sustainable technology Let me share brief on quality. let me share brief on quality In Q1, the company underwent close to 39 quality audits by multiple regulatory as well as key customers. Company has successfully passed audit inspections without any critical findings. In summary, our technology platform commercial performance today continues to enable meaningful advancement of pipeline projects as well as business development opportunities. We remain confident in our strategic direction and commitment as a source of value creation now and well into the future. With that, I would like to hand it over to Ravi to share some financial highlights. In Q1, the company underwent close to 39 quality audits by multiple regulatory as well as key customers. in q1 the company underwent close to 39 quality audits by multiple regulatory as well as key customers Company has successfully passed audit inspections without any critical findings. company has successfully passed audit inspections without any critical findings In summary, our technology platform commercial performance today continues to enable meaningful advancement of pipeline projects as well as business development opportunities. in summary our technology platform commercial performance today continues to enable meaningful advancement of pipeline projects as well as business development opportunities We remain confident in our strategic direction and commitment as a source of value creation now and well into the future. we remain confident in our strategic direction and commitment as a source of value creation now and well into the future With that, I would like to hand it over to Ravi to share some financial highlights. with that i would like to hand it over to ravi to share some financial highlights

Speaker 4: Thank you, doctor, and very warm welcome to everyone for this quarter one FY 'twenty six earnings call. Total income from operations is INR $15.70 crores with a growth of 31% year on year, and the momentum has come from the CDMO and the generic division business. Gross margin maintained very healthy, 59%, which is more than 4% due to better product mix and process improvement effort. Apart from that, raw material price improvement also. EBITDA per quarter one stands at three eighty nine growth with a margin of 25%, progressively improved versus full year for FY 'twenty five. Thank you, doctor, and very warm welcome to everyone for this quarter one FY 'twenty six earnings call. thank you doctor and very warm welcome to everyone for this quarter one fy 'twenty six earnings call Total income from operations is INR $15.70 crores with a growth of 31% year on year, and the momentum has come from the CDMO and the generic division business. total income from operations is inr $15.70 crores with a growth of 31% year on year and the momentum has come from the cdmo and the generic division business Gross margin maintained very healthy, 59%, which is more than 4% due to better product mix and process improvement effort. gross margin maintained very healthy 59% which is more than 4% due to better product mix and process improvement effort Apart from that, raw material price improvement also. apart from that raw material price improvement also EBITDA per quarter one stands at three eighty nine growth with a margin of 25%, progressively improved versus full year for FY 'twenty five. ebitda per quarter one stands at three eighty nine growth with a margin of 25% progressively improved versus full year for fy 'twenty five Profit after tax for quarter one is $1.63 growth. Growth is stand at 13%, but of course, the continued CapEx investment, which has not improved. So it has improved by 3% for versus FY 'twenty five. On the CapEx trend, we invest close to two sixty five growth for the quarter. Our net debt stood at $2,003.08 88 growth with a debt EBITDA of 1.8 versus 2.3 for the last quarter. Profit after tax for quarter one is $1.63 growth. profit after tax for quarter one is $1.63 growth Growth is stand at 13%, but of course, the continued CapEx investment, which has not improved. growth is stand at 13% but of course the continued capex investment which has not improved So it has improved by 3% for versus FY 'twenty five. so it has improved by 3% for versus fy 'twenty five On the CapEx trend, we invest close to two sixty five growth for the quarter. on the capex trend we invest close to two sixty five growth for the quarter Our net debt stood at $2,003.08 88 growth with a debt EBITDA of 1.8 versus 2.3 for the last quarter. our net debt stood at $2,003.08 88 growth with a debt ebitda of 1.8 versus 2.3 for the last quarter On the capital allocation front, our strategy remains unchanged, and we'll continue prioritizing this month into high value business segments to drive near and long term growth and returns for our shareholders. You can refer our IR presentation for more details. With this, I would request the moderator to open the lines for Q and A. Thank you. On the capital allocation front, our strategy remains unchanged, and we'll continue prioritizing this month into high value business segments to drive near and long term growth and returns for our shareholders. on the capital allocation front our strategy remains unchanged and we'll continue prioritizing this month into high value business segments to drive near and long term growth and returns for our shareholders You can refer our IR presentation for more details. you can refer our ir presentation for more details With this, I would request the moderator to open the lines for Q and A. with this i would request the moderator to open the lines for q and a Thank you. thank you

Speaker 1: Thank you very much, sir. Thank you very much, sir. thank you very much sir We will now begin the question and answer session. Participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Bharat from Quest for Value. Please go ahead. We will now begin the question and answer session. we will now begin the question and answer session Participants are requested to use handset while asking a question. participants are requested to use handset while asking a question Ladies and gentlemen, we will wait for a moment while the question queue assembles. ladies and gentlemen we will wait for a moment while the question queue assembles The first question is from the line of Bharat from Quest for Value. the first question is from the line of bharat from quest for value Please go ahead. please go ahead

Speaker 5: Yeah. Hi. First, I'd like to congratulate Bhakti Satya and Ravi for bearing good set of numbers. And I'd also like to especially congratulate Krishna Chitanya for bearing exceptional CDMO numbers consistently from past few quarters. And coming to my question, so there is a significant jump of gross margin this quarter. Yeah. yeah Hi. hi First, I'd like to congratulate Bhakti Satya and Ravi for bearing good set of numbers. first i'd like to congratulate bhakti satya and ravi for bearing good set of numbers And I'd also like to especially congratulate Krishna Chitanya for bearing exceptional CDMO numbers consistently from past few quarters. and i'd also like to especially congratulate krishna chitanya for bearing exceptional cdmo numbers consistently from past few quarters And coming to my question, so there is a significant jump of gross margin this quarter. and coming to my question so there is a significant jump of gross margin this quarter It increased by around 500 basis points. We are now at 59.5%. Can we expect this kind of high gross margins will be maintained in future too as the share of CDMO increases? Or do you see it as a one off and it's too early to expect this kind of high gross margin? It increased by around 500 basis points. it increased by around 500 basis points We are now at 59.5%. we are now at 59.5% Can we expect this kind of high gross margins will be maintained in future too as the share of CDMO increases? can we expect this kind of high gross margins will be maintained in future too as the share of cdmo increases Or do you see it as a one off and it's too early to expect this kind of high gross margin? or do you see it as a one off and it's too early to expect this kind of high gross margin

Speaker 3: Thanks, sir. Thanks, sir. thanks sir You see, if you look at our gross margins over several quarters, we're always informing and also maintaining around 52%. Now we can say as the contribution from CDMO business increases, we expect the gross margins will remain between 55% to 60%. That's what we expect in the coming quarters. You see, if you look at our gross margins over several quarters, we're always informing and also maintaining around 52%. you see if you look at our gross margins over several quarters we're always informing and also maintaining around 52% Now we can say as the contribution from CDMO business increases, we expect the gross margins will remain between 55% to 60%. now we can say as the contribution from cdmo business increases we expect the gross margins will remain between 55% to 60% That's what we expect in the coming quarters. that's what we expect in the coming quarters

Speaker 5: Okay. Thanks. Okay. okay Thanks. thanks And if you see of the past trends, CDMO in q one is generally weaker. And as year passes by, q two will be better and q three will be much better and q four will be the top. Yeah. And generally, phase two will be much better than h one. But this time, subsequently, if you see CDMO in q one is very, very strong. And if you see of the past trends, CDMO in q one is generally weaker. and if you see of the past trends cdmo in q one is generally weaker And as year passes by, q two will be better and q three will be much better and q four will be the top. and as year passes by q two will be better and q three will be much better and q four will be the top Yeah. yeah And generally, phase two will be much better than h one. and generally phase two will be much better than h one But this time, subsequently, if you see CDMO in q one is very, very strong. but this time subsequently if you see cdmo in q one is very very strong It is even better than last year's q four. Yeah. So on this date, do you still think h two will be better than h one for CDMO in FY twenty six two? It is even better than last year's q four. it is even better than last year's q four Yeah. yeah So on this date, do you still think h two will be better than h one for CDMO in FY twenty six two? so on this date do you still think h two will be better than h one for cdmo in fy twenty six two

Speaker 3: The CDMO business, you can't count quarter on quarter, but we expect good growth over last year for sure. Our manufacturing and delivery depends on their clinical programs. The CDMO business, you can't count quarter on quarter, but we expect good growth over last year for sure. the cdmo business you can't count quarter on quarter but we expect good growth over last year for sure Our manufacturing and delivery depends on their clinical programs. our manufacturing and delivery depends on their clinical programs So it it will be bumpy, but we we see we are in a good shape right now on our CDMO segment. So it it will be bumpy, but we we see we are in a good shape right now on our CDMO segment. so it it will be bumpy but we we see we are in a good shape right now on our cdmo segment

Speaker 5: Okay. Good. Thanks. And my last question is that, currently, if you see the current cycle of Global Fund tender, which is for generally for three years, it is going to end, I think, if I'm not wrong, it will be going to end by December, end of this year in December. Okay. okay Good. good Thanks. thanks And my last question is that, currently, if you see the current cycle of Global Fund tender, which is for generally for three years, it is going to end, I think, if I'm not wrong, it will be going to end by December, end of this year in December. and my last question is that currently if you see the current cycle of global fund tender which is for generally for three years it is going to end i think if i'm not wrong it will be going to end by december end of this year in december Yeah? May I know if Lotus has won the next tender cycle? Yeah? yeah May I know if Lotus has won the next tender cycle? may i know if lotus has won the next tender cycle

Speaker 3: Generally, they will run the tender little later, end of maybe September, October. See, if you see our tender, we are very successful in getting good share of that tender, and we don't see any challenges there. Generally, they will run the tender little later, end of maybe September, October. generally they will run the tender little later end of maybe september october See, if you see our tender, we are very successful in getting good share of that tender, and we don't see any challenges there. see if you see our tender we are very successful in getting good share of that tender and we don't see any challenges there

Speaker 5: Okay. Okay. okay Yes. Thank you. Thank you very much. All the best. Yes. yes Thank you. thank you Thank you very much. thank you very much All the best. all the best

Speaker 3: Yes. Thank you. Yes. yes Thank you. thank you

Speaker 1: Thank you. The next question is from the line of Jeevan Patwa from Sahasar Capital. Please go ahead. Thank you. thank you The next question is from the line of Jeevan Patwa from Sahasar Capital. the next question is from the line of jeevan patwa from sahasar capital Please go ahead. please go ahead

Speaker 6: Sir, firstly, congratulations for entire team actually for, you know so whatever hardware we have put in in last few years, I think that has started showing the results. Sir, firstly, congratulations for entire team actually for, you know so whatever hardware we have put in in last few years, I think that has started showing the results. sir firstly congratulations for entire team actually for you know so whatever hardware we have put in in last few years i think that has started showing the results I'm very happy for it. Only question I have is on the bio side, so on the food putting side. So we are basically, you know, about to set up facility for, you know, 2,000,000 liter and then 4,000,000 liter. So on the food putting side, what is the progress, sir? Are we now started putting any work there? I'm very happy for it. i'm very happy for it Only question I have is on the bio side, so on the food putting side. only question i have is on the bio side so on the food putting side So we are basically, you know, about to set up facility for, you know, 2,000,000 liter and then 4,000,000 liter. so we are basically you know about to set up facility for you know 2,000,000 liter and then 4,000,000 liter So on the food putting side, what is the progress, sir? so on the food putting side what is the progress sir Are we now started putting any work there? are we now started putting any work there Are we reactors has been orders has been placed for the reactor? Where are we in that? Are we reactors has been orders has been placed for the reactor? are we reactors has been orders has been placed for the reactor Where are we in that? where are we in that

Speaker 3: As I mentioned, given, we are installing 400 kilonewton liters of fermentation capacity in Wijac Greenfield project. That's the Phase one. As you mentioned, overall capacity at that site will go to 2,000,000 liters in two phase two more phases. As I mentioned, given, we are installing 400 kilonewton liters of fermentation capacity in Wijac Greenfield project. as i mentioned given we are installing 400 kilonewton liters of fermentation capacity in wijac greenfield project That's the Phase one. that's the phase one As you mentioned, overall capacity at that site will go to 2,000,000 liters in two phase two more phases. as you mentioned overall capacity at that site will go to 2,000,000 liters in two phase two more phases In phase two, phase three put together, it will go to 2,000,000 liters. And we have very good visibility about utilization of that fermentation site, which product, which customer and all. Like we are gaining confidence and gaining visibility in our small molecule CDMO segment. We're also seeing a lot of visibility now, what customer, what project, what price, what time line and our large molecule CDM. As you were talking about our focus on food protein, food proteins we are focusing, but focus as also on other proteins, cosmetic proteins, some polymers produced by fermentation. In phase two, phase three put together, it will go to 2,000,000 liters. in phase two phase three put together it will go to 2,000,000 liters And we have very good visibility about utilization of that fermentation site, which product, which customer and all. and we have very good visibility about utilization of that fermentation site which product which customer and all Like we are gaining confidence and gaining visibility in our small molecule CDMO segment. like we are gaining confidence and gaining visibility in our small molecule cdmo segment We're also seeing a lot of visibility now, what customer, what project, what price, what time line and our large molecule CDM. we're also seeing a lot of visibility now what customer what project what price what time line and our large molecule cdm As you were talking about our focus on food protein, food proteins we are focusing, but focus as also on other proteins, cosmetic proteins, some polymers produced by fermentation. as you were talking about our focus on food protein food proteins we are focusing but focus as also on other proteins cosmetic proteins some polymers produced by fermentation So the offerings are becoming very interesting, which are also So the offerings are becoming very interesting, which are also so the offerings are becoming very interesting which are also

Speaker 6: Wonderful, sir. Wonderful, sir. And second question I have is on the Immuno Ads. So how do you see the ramp up in, you know, number of so capacity, I understand, will come on stream by twenty September. Wonderful, sir. wonderful sir Wonderful, sir. wonderful sir And second question I have is on the Immuno Ads. and second question i have is on the immuno ads So how do you see the ramp up in, you know, number of so capacity, I understand, will come on stream by twenty September. so how do you see the ramp up in you know number of so capacity i understand will come on stream by twenty september But in terms of the response from the market, I just wanted to understand your feedback on that. How is the response from the market? Are we also seeing a foreign national traveling to India to get this treatment done? In India, since the cost is much lower. But in terms of the response from the market, I just wanted to understand your feedback on that. but in terms of the response from the market i just wanted to understand your feedback on that How is the response from the market? how is the response from the market Are we also seeing a foreign national traveling to India to get this treatment done? are we also seeing a foreign national traveling to india to get this treatment done In India, since the cost is much lower. in india since the cost is much lower

Speaker 3: There are some more treatments offered to foreigners. There are some more treatments offered to foreigners. there are some more treatments offered to foreigners That was based on the hospital's child. What is also happening, we are also trying to build overseas presence by entering partnership with some big pharma in those regions. Maybe in the near future, we'll give you more details on our global expansion of CAR T therapy using Immunat. That was based on the hospital's child. that was based on the hospital's child What is also happening, we are also trying to build overseas presence by entering partnership with some big pharma in those regions. what is also happening we are also trying to build overseas presence by entering partnership with some big pharma in those regions Maybe in the near future, we'll give you more details on our global expansion of CAR T therapy using Immunat. maybe in the near future we'll give you more details on our global expansion of car t therapy using immunat

Speaker 6: Okay. Great, sir. Okay. okay Great, sir. great sir Great. And third, last is on the gene therapy, sir. So we are setting up a viral vector facility in Kanpur. Right? So so any any update there, sir? Great. great And third, last is on the gene therapy, sir. and third last is on the gene therapy sir So we are setting up a viral vector facility in Kanpur. so we are setting up a viral vector facility in kanpur Right? right So so any any update there, sir? so so any any update there sir

Speaker 3: So there is a change in our approach because our thought process changed from 2,500 square meter facility to 6,000 square meter facility. So there is no space available at Technopark in Kanpur. So we have moved idea of that facility to Hyderabad, Genome Valley, where we have broke the ground for a 6,000 square meter facility. And whatever gene therapy, viral vector and also drug building houses, antibody drug conjugate GMP facility as well. So because we have added another therapy ADC, we start to move to Hyderabad. So there is a change in our approach because our thought process changed from 2,500 square meter facility to 6,000 square meter facility. so there is a change in our approach because our thought process changed from 2,500 square meter facility to 6,000 square meter facility So there is no space available at Technopark in Kanpur. so there is no space available at technopark in kanpur So we have moved idea of that facility to Hyderabad, Genome Valley, where we have broke the ground for a 6,000 square meter facility. so we have moved idea of that facility to hyderabad genome valley where we have broke the ground for a 6,000 square meter facility And whatever gene therapy, viral vector and also drug building houses, antibody drug conjugate GMP facility as well. and whatever gene therapy viral vector and also drug building houses antibody drug conjugate gmp facility as well So because we have added another therapy ADC, we start to move to Hyderabad. so because we have added another therapy adc we start to move to hyderabad

Speaker 6: Okay. Okay, sir. Thanks a lot. Thanks a lot. Okay. okay Okay, sir. okay sir Thanks a lot. thanks a lot Thanks a lot. thanks a lot

Speaker 1: The next question is from the line of Rahul, an individual investor. Please go ahead. The next question is from the line of Rahul, an individual investor. the next question is from the line of rahul an individual investor Please go ahead. please go ahead

Speaker 7: Hey, thank you for the opportunity and congratulations on the great set of numbers. But, Shala, if you can possibly paint a picture for us, you know, with over the last five years, we've kind of come a long way. And the product mix has changed, and now we see the CDM revenue contributing to 30 plus percent. Last, you know, probably five years ago, it was less than 10%. Hey, thank you for the opportunity and congratulations on the great set of numbers. hey thank you for the opportunity and congratulations on the great set of numbers But, Shala, if you can possibly paint a picture for us, you know, with over the last five years, we've kind of come a long way. but shala if you can possibly paint a picture for us you know with over the last five years we've kind of come a long way And the product mix has changed, and now we see the CDM revenue contributing to 30 plus percent. and the product mix has changed and now we see the cdm revenue contributing to 30 plus percent Last, you know, probably five years ago, it was less than 10%. last you know probably five years ago it was less than 10% At this point, we see the contribution from the biodiesel to be less than 5%. How do you see this product mix changing, you know, five years out and what what is the vision of the company over there? If if you can, you know, share a bit on that, I'd be interested in the listing. At this point, we see the contribution from the biodiesel to be less than 5%. at this point we see the contribution from the biodiesel to be less than 5% How do you see this product mix changing, you know, five years out and what what is the vision of the company over there? how do you see this product mix changing you know five years out and what what is the vision of the company over there If if you can, you know, share a bit on that, I'd be interested in the listing. if if you can you know share a bit on that i'd be interested in the listing

Speaker 3: We while we continue to focus on our core, which is APIs and integrated offerings in generics, we are also increasing our investments, CapEx, resources and technology platforms to offer wide variety of services for late clinical and commercial human health, animal health and crop science programs. As we've mentioned, currently, the CDMO contributes over 30% of our revenue. We while we continue to focus on our core, which is APIs and integrated offerings in generics, we are also increasing our investments, CapEx, resources and technology platforms to offer wide variety of services for late clinical and commercial human health, animal health and crop science programs. we while we continue to focus on our core which is apis and integrated offerings in generics we are also increasing our investments capex resources and technology platforms to offer wide variety of services for late clinical and commercial human health animal health and crop science programs As we've mentioned, currently, the CDMO contributes over 30% of our revenue. as we've mentioned currently the cdmo contributes over 30% of our revenue We expect this will continue to grow. We have in the near future, near to medium to the future, we expect it has a potential to touch 50%. So that's our guesstimate. We expect this will continue to grow. we expect this will continue to grow We have in the near future, near to medium to the future, we expect it has a potential to touch 50%. we have in the near future near to medium to the future we expect it has a potential to touch 50% So that's our guesstimate. so that's our guesstimate

Speaker 7: Thank you so much. Like just a hypothetical question, at any point in time, do you see these decisions becoming, you know, big to the extent that, you know, the the there may be a possibility of listing these as, you know, separate entities and business? Thank you so much. thank you so much Like just a hypothetical question, at any point in time, do you see these decisions becoming, you know, big to the extent that, you know, the the there may be a possibility of listing these as, you know, separate entities and business? like just a hypothetical question at any point in time do you see these decisions becoming you know big to the extent that you know the the there may be a possibility of listing these as you know separate entities and business

Speaker 3: We don't have any plans for that. We don't have any plans for that. we don't have any plans for that

Speaker 7: Okay. Thank you so much, wish you all the good luck. Thank you. Okay. okay Thank you so much, wish you all the good luck. thank you so much wish you all the good luck Thank you. thank you

Speaker 1: Thank you. Thank you. thank you The next question is from the line of Chirag Shah from White Pine Investment. Please go ahead. The next question is from the line of Chirag Shah from White Pine Investment. the next question is from the line of chirag shah from white pine investment Please go ahead. please go ahead

Speaker 8: Please offer the opportunity. Congratulations on good set of numbers. My first question is on gross margins that we have seen. Please offer the opportunity. please offer the opportunity Congratulations on good set of numbers. congratulations on good set of numbers My first question is on gross margins that we have seen. my first question is on gross margins that we have seen Would it be right to assume that the gross margin improvement is driven by non CD four business significantly or largely? Because CDMO gross margins would largely be taking a range. Right? Maybe 5% deviation here and there. So would it be a right statement to meet that the sharp increment in gross margin over last six, seven quarters that let's see is driven by a non P and L business, and it would be now almost closer to what we were three years back. Would it be right to assume that the gross margin improvement is driven by non CD four business significantly or largely? would it be right to assume that the gross margin improvement is driven by non cd four business significantly or largely Because CDMO gross margins would largely be taking a range. because cdmo gross margins would largely be taking a range Right? right Maybe 5% deviation here and there. maybe 5% deviation here and there So would it be a right statement to meet that the sharp increment in gross margin over last six, seven quarters that let's see is driven by a non P and L business, and it would be now almost closer to what we were three years back. so would it be a right statement to meet that the sharp increment in gross margin over last six seven quarters that let's see is driven by a non p and l business and it would be now almost closer to what we were three years back

Speaker 3: If you look at our quarter on quarter performance, our revenue decline came from ARVs and other generic, whereas there was a growth from CDMO. So I think these two contributed the gross margin expansion. But, sir, what is the right statement that in gross margin in CDMO, your gross margin would reasonably be stable irrespective of the stage of project, whether it's an early stage or late stage, or it materially varies gross margins from the state of the project that you are You are right. The generally, the gross margins remain similar. That's the proper stage and scale of the project. If you look at our quarter on quarter performance, our revenue decline came from ARVs and other generic, whereas there was a growth from CDMO. if you look at our quarter on quarter performance our revenue decline came from arvs and other generic whereas there was a growth from cdmo So I think these two contributed the gross margin expansion. so i think these two contributed the gross margin expansion But, sir, what is the right statement that in gross margin in CDMO, your gross margin would reasonably be stable irrespective of the stage of project, whether it's an early stage or late stage, or it materially varies gross margins from the state of the project that you are You are right. but sir what is the right statement that in gross margin in cdmo your gross margin would reasonably be stable irrespective of the stage of project whether it's an early stage or late stage or it materially varies gross margins from the state of the project that you are you are right The generally, the gross margins remain similar. the generally the gross margins remain similar That's the proper stage and scale of the project. that's the proper stage and scale of the project

Speaker 8: It's okay. That one. That really answered my question. So and, sir, then in that case, which part of the non CDMO business has been contributing to margin? Because if I do some mathematics, sir, there is a significant improvement of almost 700 to a thousand bits in non series glass margin. It's okay. it's okay That one. that one That really answered my question. that really answered my question So and, sir, then in that case, which part of the non CDMO business has been contributing to margin? so and sir then in that case which part of the non cdmo business has been contributing to margin Because if I do some mathematics, sir, there is a significant improvement of almost 700 to a thousand bits in non series glass margin. because if i do some mathematics sir there is a significant improvement of almost 700 to a thousand bits in non series glass margin So is it the ARV part or SDF part which is driving or or is it in the shed from, like It's majority came from non ARV. Majority came from non And is that further scope of improvement was there? Or rather, what is driving that on ARV performance? So is it the ARV part or SDF part which is driving or or is it in the shed from, like It's majority came from non ARV. so is it the arv part or sdf part which is driving or or is it in the shed from like it's majority came from non arv Majority came from non And is that further scope of improvement was there? majority came from non and is that further scope of improvement was there Or rather, what is driving that on ARV performance? or rather what is driving that on arv performance

Speaker 3: Based on some shipments, as I mentioned, we expect the gross margins remain between 55 to 60. Earlier, we used to say around 55. Based on some shipments, as I mentioned, we expect the gross margins remain between 55 to 60. based on some shipments as i mentioned we expect the gross margins remain between 55 to 60 Earlier, we used to say around 55. earlier we used to say around 55 Now we are saying it will be 55 to 60%. So that's very healthy, and we expect we'll be able to maintain that. Now we are saying it will be 55 to 60%. now we are saying it will be 55 to 60% So that's very healthy, and we expect we'll be able to maintain that. so that's very healthy and we expect we'll be able to maintain that

Speaker 8: Sir, one last question. Any pre buying that you have witnessed or any indication of pre buying given the potential risk of some tariff that could come across? So is there any pre buying that you have witnessed from your customers? Sir, one last question. sir one last question Any pre buying that you have witnessed or any indication of pre buying given the potential risk of some tariff that could come across? any pre buying that you have witnessed or any indication of pre buying given the potential risk of some tariff that could come across So is there any pre buying that you have witnessed from your customers? so is there any pre buying that you have witnessed from your customers

Speaker 3: I think it's very difficult question to get an answer because we have to wait. And as you have seen from our results, see, our dependency on formulation sales to U. S. Are not that significant. Yes. Yes. I think it's very difficult question to get an answer because we have to wait. i think it's very difficult question to get an answer because we have to wait And as you have seen from our results, see, our dependency on formulation sales to U. and as you have seen from our results see our dependency on formulation sales to u S. s Are not that significant. are not that significant Yes. yes Yes. yes

Speaker 8: Great. Thanks, guys. Great. great Thanks, guys. thanks guys

Speaker 1: Thank you. The next question is from the line of Tushar Panudhani from financial services. Please go ahead. Thank you. thank you The next question is from the line of Tushar Panudhani from financial services. the next question is from the line of tushar panudhani from financial services Please go ahead. please go ahead

Speaker 9: Am I audible? Am I audible? am i audible

Speaker 3: Yes. Very well. Yes. yes Very well. very well

Speaker 9: Sir, just on how that, you know, the animal health facility is commissioned, even agrochemical. Sir, just on how that, you know, the animal health facility is commissioned, even agrochemical. sir just on how that you know the animal health facility is commissioned even agrochemical So has this contributed meaningfully for the CDMO business for the quarter? Or the other way to ask is, if you could break the CDMO business into human health, animal health and the agrochemical and increase? So has this contributed meaningfully for the CDMO business for the quarter? so has this contributed meaningfully for the cdmo business for the quarter Or the other way to ask is, if you could break the CDMO business into human health, animal health and the agrochemical and increase? or the other way to ask is if you could break the cdmo business into human health animal health and the agrochemical and increase

Speaker 3: The contributions from human health and animal health were there in this quarter, nothing significant from cost sciences in this quarter. The contributions from human health and animal health were there in this quarter, nothing significant from cost sciences in this quarter. the contributions from human health and animal health were there in this quarter nothing significant from cost sciences in this quarter

Speaker 9: Will that come up in the coming quarters? Is that the same assumption or it would take some more time to or the security for for that segment? Will that come up in the coming quarters? will that come up in the coming quarters Is that the same assumption or it would take some more time to or the security for for that segment? is that the same assumption or it would take some more time to or the security for for that segment

Speaker 3: We expect meaningful revenues from craft centers will only come next financial year. So just no different. We expect meaningful revenues from craft centers will only come next financial year. we expect meaningful revenues from craft centers will only come next financial year So just no different. so just no different

Speaker 9: Is it a similar chemistry and hence, it's just a different application or how to think about it, specifically for next five to six years? Is it a similar chemistry and hence, it's just a different application or how to think about it, specifically for next five to six years? is it a similar chemistry and hence it's just a different application or how to think about it specifically for next five to six years

Speaker 3: The facilities for animal health are segregated and dedicated. You can't use that for human health or craft science. The facilities for animal health are segregated and dedicated. the facilities for animal health are segregated and dedicated You can't use that for human health or craft science. you can't use that for human health or craft science Similarly, the craft science facilities are also segregated and dedicated. So those can be used for only craft sciences. So interchangeability of these two facilities are not possible. Whereas human health, we have large capacity where we can do these projects in multiple sites at multiple scales. Similarly, the craft science facilities are also segregated and dedicated. similarly the craft science facilities are also segregated and dedicated So those can be used for only craft sciences. so those can be used for only craft sciences So interchangeability of these two facilities are not possible. so interchangeability of these two facilities are not possible Whereas human health, we have large capacity where we can do these projects in multiple sites at multiple scales. whereas human health we have large capacity where we can do these projects in multiple sites at multiple scales

Speaker 9: Understood, sir. Understood, sir. understood sir And just lastly on bio side, where there has been certain issues with the customer. So probably, if that customer comes back or if you have new customers, like can there be timeline approximately for this business to sort of revise? And just lastly on bio side, where there has been certain issues with the customer. and just lastly on bio side where there has been certain issues with the customer So probably, if that customer comes back or if you have new customers, like can there be timeline approximately for this business to sort of revise? so probably if that customer comes back or if you have new customers like can there be timeline approximately for this business to sort of revise

Speaker 3: There is no challenge. It's only delay. The project now the bottleneck was resolved, things are back to normal. There is no challenge. there is no challenge It's only delay. it's only delay The project now the bottleneck was resolved, things are back to normal. the project now the bottleneck was resolved things are back to normal And we don't see when we look at the entire year, we don't see any big challenge achieving what numbers we thought at the beginning of the year. And we don't see when we look at the entire year, we don't see any big challenge achieving what numbers we thought at the beginning of the year. and we don't see when we look at the entire year we don't see any big challenge achieving what numbers we thought at the beginning of the year

Speaker 1: Thank you. The next question is from the line of from Antifragile Thinking. Please go ahead. Thank you. thank you The next question is from the line of from Antifragile Thinking. the next question is from the line of from antifragile thinking Please go ahead. please go ahead

Speaker 10: Yes. Many thanks for taking my questions. Doctor, progress update you can share regarding the Villo Bio and AI driven bioengineering platform partnership we are progressing with, I mean, what advantages does bioengineering provide over chemical, you know, conventional chemical synthesis in terms of efficiency cost and sustainability, please? Yes. yes Many thanks for taking my questions. many thanks for taking my questions Doctor, progress update you can share regarding the Villo Bio and AI driven bioengineering platform partnership we are progressing with, I mean, what advantages does bioengineering provide over chemical, you know, conventional chemical synthesis in terms of efficiency cost and sustainability, please? doctor progress update you can share regarding the villo bio and ai driven bioengineering platform partnership we are progressing with i mean what advantages does bioengineering provide over chemical you know conventional chemical synthesis in terms of efficiency cost and sustainability please

Speaker 3: This is what programs we are working with Willow using the AI driven engineering platform, primarily hydroxylation platform. Adding Hydroxy, Bruchsan, Stera Azerul backbone, that's the one we are working. There are multiple programs. Maybe in this financial year, one program will go from lab to pilot mode. And we expect two more programs in the next financial year. This is what programs we are working with Willow using the AI driven engineering platform, primarily hydroxylation platform. this is what programs we are working with willow using the ai driven engineering platform primarily hydroxylation platform Adding Hydroxy, Bruchsan, Stera Azerul backbone, that's the one we are working. adding hydroxy bruchsan stera azerul backbone that's the one we are working There are multiple programs. there are multiple programs Maybe in this financial year, one program will go from lab to pilot mode. maybe in this financial year one program will go from lab to pilot mode And we expect two more programs in the next financial year. and we expect two more programs in the next financial year

Speaker 10: And and do we expect the learnings out of this program to be kind of integrated into some of our future ventures? I mean, because bio is a very emerging promising area, we we are just exploring the possibility of the iceberg. And and do we expect the learnings out of this program to be kind of integrated into some of our future ventures? and and do we expect the learnings out of this program to be kind of integrated into some of our future ventures I mean, because bio is a very emerging promising area, we we are just exploring the possibility of the iceberg. i mean because bio is a very emerging promising area we we are just exploring the possibility of the iceberg

Speaker 3: Our partnership with Billow is primarily meant for steroids and arsenals, where I got the who don't our our Bengal team is doing development, whereas Billo is doing research. I think they are identified the enzyme and then they give it to Bengal team for optimization. So they're working very that partnership is working well. And we we currently, we are not intending to use that technology on any other program right now. Our partnership with Billow is primarily meant for steroids and arsenals, where I got the who don't our our Bengal team is doing development, whereas Billo is doing research. our partnership with billow is primarily meant for steroids and arsenals where i got the who don't our our bengal team is doing development whereas billo is doing research I think they are identified the enzyme and then they give it to Bengal team for optimization. i think they are identified the enzyme and then they give it to bengal team for optimization So they're working very that partnership is working well. so they're working very that partnership is working well And we we currently, we are not intending to use that technology on any other program right now. and we we currently we are not intending to use that technology on any other program right now

Speaker 10: Understood. And thank you for that. Ramiti, this new CapEx investment of over 5,000 crores that we have announced in Andhra Pradesh, I guess, will be executed over multiple phases and years. So, and if my assumption is correct, can we therefore anticipate maintaining a healthy net debt to EBITDA ratio despite this massive growth CapEx? Understood. understood And thank you for that. and thank you for that Ramiti, this new CapEx investment of over 5,000 crores that we have announced in Andhra Pradesh, I guess, will be executed over multiple phases and years. ramiti this new capex investment of over 5,000 crores that we have announced in andhra pradesh i guess will be executed over multiple phases and years So, and if my assumption is correct, can we therefore anticipate maintaining a healthy net debt to EBITDA ratio despite this massive growth CapEx? so and if my assumption is correct can we therefore anticipate maintaining a healthy net debt to ebitda ratio despite this massive growth capex

Speaker 4: Yes. As we indicated before, we are going to invest INR 5,000 crores in the next five year time. I think cash flows, internal cash flows will sufficient to take care of it. As we indicate, we don't make our debt net debt is more than 50% of our revenue in any point of time. Yes. yes As we indicated before, we are going to invest INR 5,000 crores in the next five year time. as we indicated before we are going to invest inr 5,000 crores in the next five year time I think cash flows, internal cash flows will sufficient to take care of it. i think cash flows internal cash flows will sufficient to take care of it As we indicate, we don't make our debt net debt is more than 50% of our revenue in any point of time. as we indicate we don't make our debt net debt is more than 50% of our revenue in any point of time

Speaker 10: Sure. Sure. And finally, in the context of Trump's Make in America, a big pharma is investing heavily in biologics, gene therapies, rate laws, drugs, even diagnostics, and and more to expand, you know, capacity and strengthen their supply chain. So and and many of them from Roche to AstraZeneca to Eli Lilly, almost all of them have announced, you know, multi billion dollar CapEx in The US. So how will these investments by innovators in The US affect the outsourcing and CDMO industry? Sure. sure Sure. sure And finally, in the context of Trump's Make in America, a big pharma is investing heavily in biologics, gene therapies, rate laws, drugs, even diagnostics, and and more to expand, you know, capacity and strengthen their supply chain. and finally in the context of trump's make in america a big pharma is investing heavily in biologics gene therapies rate laws drugs even diagnostics and and more to expand you know capacity and strengthen their supply chain So and and many of them from Roche to AstraZeneca to Eli Lilly, almost all of them have announced, you know, multi billion dollar CapEx in The US. so and and many of them from roche to astrazeneca to eli lilly almost all of them have announced you know multi billion dollar capex in the us So how will these investments by innovators in The US affect the outsourcing and CDMO industry? so how will these investments by innovators in the us affect the outsourcing and cdmo industry

Speaker 3: These big pharmas have very large pipeline. Maybe part of the supply chain will be located in U. S, part of the supply chain located outside. We have to see how it evolves. Everybody is announcing a lot of investments in U. These big pharmas have very large pipeline. these big pharmas have very large pipeline Maybe part of the supply chain will be located in U. maybe part of the supply chain will be located in u S, part of the supply chain located outside. s part of the supply chain located outside We have to see how it evolves. we have to see how it evolves Everybody is announcing a lot of investments in U. everybody is announcing a lot of investments in u S. We don't see a beginning of impact. So as we mentioned, they will not move core chemistry to U. S. They will move cell and gene therapy, finishing steps. S. s We don't see a beginning of impact. we don't see a beginning of impact So as we mentioned, they will not move core chemistry to U. so as we mentioned they will not move core chemistry to u S. s They will move cell and gene therapy, finishing steps. they will move cell and gene therapy finishing steps Though the demand for intermediates will remain constant or increasing maybe. Though the demand for intermediates will remain constant or increasing maybe. though the demand for intermediates will remain constant or increasing maybe

Speaker 10: And maybe small molecules API as well, that's not going to move to US. And maybe small molecules API as well, that's not going to move to US. and maybe small molecules api as well that's not going to move to us

Speaker 3: Yeah. That's what we believe. Yeah. Right. Yeah. yeah That's what we believe. that's what we believe Yeah. yeah Right. right

Speaker 10: Yeah. Yeah. yeah Yeah. Sure. Sure. That's all from my side. Thank you. Thank you so much. Yeah. yeah Sure. sure Sure. sure That's all from my side. that's all from my side Thank you. thank you Thank you so much. thank you so much

Speaker 3: Thank you. Thank you. thank you

Speaker 1: Thank you. The next question is from the line of Vivek, an individual investor. Please go ahead. Thank you. thank you The next question is from the line of Vivek, an individual investor. the next question is from the line of vivek an individual investor Please go ahead. please go ahead

Speaker 7: Good evening, sir. I have a question regarding the large buyer, sir. You have mentioned that there is a pricing challenge in that particular site in for the large buyer. Could you please share the details on the pricing challenge? And and the second question is that, what can be the how big it can become in next five to ten years at large buyer sales? Good evening, sir. good evening sir I have a question regarding the large buyer, sir. i have a question regarding the large buyer sir You have mentioned that there is a pricing challenge in that particular site in for the large buyer. you have mentioned that there is a pricing challenge in that particular site in for the large buyer Could you please share the details on the pricing challenge? could you please share the details on the pricing challenge And and the second question is that, what can be the how big it can become in next five to ten years at large buyer sales? and and the second question is that what can be the how big it can become in next five to ten years at large buyer sales

Speaker 3: See, the pricing challenge at Bio pertains to hiring reactor months to product billing. So that was the one shift happened. Because in the clinical not clinical trial, since we don't know how many days fermentation will take, how many days the downstream processing happens. So customer is to pay per month or per batch. Once the product stabilizes, then they will the billing will go to per kg. See, the pricing challenge at Bio pertains to hiring reactor months to product billing. see the pricing challenge at bio pertains to hiring reactor months to product billing So that was the one shift happened. so that was the one shift happened Because in the clinical not clinical trial, since we don't know how many days fermentation will take, how many days the downstream processing happens. because in the clinical not clinical trial since we don't know how many days fermentation will take how many days the downstream processing happens So customer is to pay per month or per batch. so customer is to pay per month or per batch Once the product stabilizes, then they will the billing will go to per kg. once the product stabilizes then they will the billing will go to per kg So that's the pricing shift happening for them when the product mature. The question regarding the opportunities in the next five years, we see significant potential. That is the reason we are investing a lot of money in greenfield projects. As we mentioned, the Phase one itself, we are exceeding 400 kiloliters capacity and eventually it will go to 2,000,000 liters of fermentation capacity. So that's the pricing shift happening for them when the product mature. so that's the pricing shift happening for them when the product mature The question regarding the opportunities in the next five years, we see significant potential. the question regarding the opportunities in the next five years we see significant potential That is the reason we are investing a lot of money in greenfield projects. that is the reason we are investing a lot of money in greenfield projects As we mentioned, the Phase one itself, we are exceeding 400 kiloliters capacity and eventually it will go to 2,000,000 liters of fermentation capacity. as we mentioned the phase one itself we are exceeding 400 kiloliters capacity and eventually it will go to 2,000,000 liters of fermentation capacity

Speaker 7: Okay, sir. Okay, sir. okay sir Thank you for answering the question, sir. I'll join in the queue, sir. Thank you. Thank you for answering the question, sir. thank you for answering the question sir I'll join in the queue, sir. i'll join in the queue sir Thank you. thank you

Speaker 1: The next question is from the line of Abhijit, an individual investor. Please go ahead. The next question is from the line of Abhijit, an individual investor. the next question is from the line of abhijit an individual investor Please go ahead. please go ahead Mister Abhijit, your line has been unmuted. Please go ahead with your question. Mister Abhijit, your line has been unmuted. mister abhijit your line has been unmuted Please go ahead with your question. please go ahead with your question

Speaker 7: Yeah. Am I audible? Yeah. yeah Am I audible? am i audible

Speaker 3: Audible, Abhijit. Audible, Abhijit. audible abhijit

Speaker 7: Yeah. Great set of numbers. I have a question with regards to the FBS. If you can see on a quarterly basis, there's been a reduction. Is this the volatility in these numbers have been there for the last four quarters in the presentation. Yeah. yeah Great set of numbers. great set of numbers I have a question with regards to the FBS. i have a question with regards to the fbs If you can see on a quarterly basis, there's been a reduction. if you can see on a quarterly basis there's been a reduction Is this the volatility in these numbers have been there for the last four quarters in the presentation. is this the volatility in these numbers have been there for the last four quarters in the presentation So is this going to continue? Is there any stability that is going to be there in the generic FBS and generic portfolio? That's one question. So is this going to continue? so is this going to continue Is there any stability that is going to be there in the generic FBS and generic portfolio? is there any stability that is going to be there in the generic fbs and generic portfolio That's one question. that's one question

Speaker 3: The majority delta in our sales in FDF is coming from how many millions of packs of anti retroviral we're shipping in the quarter. So overall, we're shipping the same number, but depending on the approvals from various countries to ship logistics and all, revenue recognition, because most of them are fee shipments. The majority delta in our sales in FDF is coming from how many millions of packs of anti retroviral we're shipping in the quarter. the majority delta in our sales in fdf is coming from how many millions of packs of anti retroviral we're shipping in the quarter So overall, we're shipping the same number, but depending on the approvals from various countries to ship logistics and all, revenue recognition, because most of them are fee shipments. so overall we're shipping the same number but depending on the approvals from various countries to ship logistics and all revenue recognition because most of them are fee shipments So those are the factors contributing to the variation in the generic formulation sales. So those are the factors contributing to the variation in the generic formulation sales. so those are the factors contributing to the variation in the generic formulation sales

Speaker 7: Okay. My next question is with regards to this crazy move that everybody is making in India and globally about peptides and the opportunity for GLP-one and weight loss drugs basically and also other peptide products. Is there any opportunity that is available for LORUS also in this case? Okay. okay My next question is with regards to this crazy move that everybody is making in India and globally about peptides and the opportunity for GLP-one and weight loss drugs basically and also other peptide products. my next question is with regards to this crazy move that everybody is making in india and globally about peptides and the opportunity for glp-one and weight loss drugs basically and also other peptide products Is there any opportunity that is available for LORUS also in this case? is there any opportunity that is available for lorus also in this case

Speaker 3: We believe so. We believe so. we believe so

Speaker 7: Okay. You you don't wanna go more further about it? Okay. okay You you don't wanna go more further about it? you you don't wanna go more further about it

Speaker 3: Yeah. I mean, you don't want to disclose, I guess. Is that Yeah. Is that correct? Yeah. yeah I mean, you don't want to disclose, I guess. i mean you don't want to disclose i guess Is that Yeah. is that yeah Is that correct? is that correct

Speaker 7: Okay. Okay. okay

Speaker 3: Yes. Yes. yes

Speaker 7: Thank you. Thank you. Thank you. Thank you. thank you Thank you. thank you Thank you. thank you

Speaker 1: You. The next question is from the line of Pankaj Mahajan from Shantam Wealth. Please go ahead. You. you The next question is from the line of Pankaj Mahajan from Shantam Wealth. the next question is from the line of pankaj mahajan from shantam wealth Please go ahead. please go ahead

Speaker 7: Sir, congrats for a good set of number. Sir, congrats for a good set of number. sir congrats for a good set of number Sir, can I get a breakup of this 5,000 crore CapEx? How much is going for the CDMO over the next five years? Sir, can I get a breakup of this 5,000 crore CapEx? sir can i get a breakup of this 5,000 crore capex How much is going for the CDMO over the next five years? how much is going for the cdmo over the next five years

Speaker 4: No, we are not disclose that. It will interchange based on the business opportunity. No, we are not disclose that. no we are not disclose that It will interchange based on the business opportunity. it will interchange based on the business opportunity

Speaker 7: Okay. Thank you, sir. Thanks for the call. Okay. okay Thank you, sir. thank you sir Thanks for the call. thanks for the call

Speaker 1: The next question is from the line of Vishal from Motilal Resolve. Please go ahead. The next question is from the line of Vishal from Motilal Resolve. the next question is from the line of vishal from motilal resolve Please go ahead. please go ahead

Speaker 9: Sir, just a housekeeping question on this AirView business, if you could do breakup of formulation and. Sir, just a housekeeping question on this AirView business, if you could do breakup of formulation and. sir just a housekeeping question on this airview business if you could do breakup of formulation and

Speaker 3: Yes. Just give me one minute. We'll give you the API. Yeah. We API is $3.63 crores and formulation is $2.84. Yes. yes Just give me one minute. just give me one minute We'll give you the API. we'll give you the api Yeah. yeah We API is $3.63 crores and formulation is $2.84. we api is $3.63 crores and formulation is $2.84 About 640 crores, both the API and formulations could do that. $3.60 and $2.80. About 640 crores, both the API and formulations could do that. about 640 crores both the api and formulations could do that $3.60 and $2.80. $3.60 and $2.80

Speaker 9: Okay. Okay. okay

Speaker 3: So now for this one, ARV formulation, you know, we've seen a bit moderate run rate over past, so this is process if you could We are expanding our capacity for non ARV formulations and which will be qualified by end of this year. So we can expect non ARV formulations to grow from Q4 onwards. So now for this one, ARV formulation, you know, we've seen a bit moderate run rate over past, so this is process if you could We are expanding our capacity for non ARV formulations and which will be qualified by end of this year. so now for this one arv formulation you know we've seen a bit moderate run rate over past so this is process if you could we are expanding our capacity for non arv formulations and which will be qualified by end of this year So we can expect non ARV formulations to grow from Q4 onwards. so we can expect non arv formulations to grow from q4 onwards

Speaker 9: But on the product approval side also there has been a bit, correct me if I'm wrong. But on the product approval side also there has been a bit, correct me if I'm wrong. but on the product approval side also there has been a bit correct me if i'm wrong

Speaker 3: Not our revenue growth primarily comes from contract manufacturing of integrated formulations, both API and FDF. So once the capacity, we were doing tech transfers. Once the capacity is qualified, we don't see lag in revenues. Not our revenue growth primarily comes from contract manufacturing of integrated formulations, both API and FDF. not our revenue growth primarily comes from contract manufacturing of integrated formulations both api and fdf So once the capacity, we were doing tech transfers. so once the capacity we were doing tech transfers Once the capacity is qualified, we don't see lag in revenues. once the capacity is qualified we don't see lag in revenues

Speaker 9: Got it. Thanks very much. Got it. got it Thanks very much. thanks very much

Speaker 1: Thank you. The next question is from the line of from Investment. Please go ahead. Thank you. thank you The next question is from the line of from Investment. the next question is from the line of from investment Please go ahead. please go ahead

Speaker 8: Yes, sir. Yes, sir. yes sir Thanks for the opportunity again. And sir, apologies. I'm going back to the gross margin point. So on the non ARV side, would it be a right statement that we are almost at the peak gross margins that we had in the past around 2021? On the non CDMO aggregate gross margin, which could be a function of which, I'm not going to do those details, but non CDMO gross gross margin would be closer to the peak maybe of a '21 or '22 that we had. Thanks for the opportunity again. thanks for the opportunity again And sir, apologies. and sir apologies I'm going back to the gross margin point. i'm going back to the gross margin point So on the non ARV side, would it be a right statement that we are almost at the peak gross margins that we had in the past around 2021? so on the non arv side would it be a right statement that we are almost at the peak gross margins that we had in the past around 2021 On the non CDMO aggregate gross margin, which could be a function of which, I'm not going to do those details, but non CDMO gross gross margin would be closer to the peak maybe of a '21 or '22 that we had. on the non cdmo aggregate gross margin which could be a function of which i'm not going to do those details but non cdmo gross gross margin would be closer to the peak maybe of a '21 or '22 that we had

Speaker 4: Yeah. Yeah. I mean, it's it's a difficult, it may be maybe closer. Yeah. yeah Yeah. yeah I mean, it's it's a difficult, it may be maybe closer. i mean it's it's a difficult it may be maybe closer

Speaker 3: We are we are we are right. Maybe closer. We are we are we are right. we are we are we are right Maybe closer. maybe closer We had a very good gross margin. I'll I'll put it that way. We had a very good gross margin. we had a very good gross margin I'll I'll put it that way. i'll i'll put it that way

Speaker 8: So Yeah. So my so my actual question is, so what are we doing from here on to improve that part, that piece of gross margin for that business? So Yeah. so yeah So my so my actual question is, so what are we doing from here on to improve that part, that piece of gross margin for that business? so my so my actual question is so what are we doing from here on to improve that part that piece of gross margin for that business

Speaker 3: As we grow our CDMO business, as we see, today, we haven't achieved operational efficiency, still a lot of unutilized capacities and all. As we grow our CDMO business, as we see, today, we haven't achieved operational efficiency, still a lot of unutilized capacities and all. as we grow our cdmo business as we see today we haven't achieved operational efficiency still a lot of unutilized capacities and all As we grow our revenues, we are not going to grow our R and D and quality staff proportionately. We are going to increase other expenditure proportionately. If you look at when our revenue was net, cost of employees went up to 17%. It is sometimes it was down 10%. So we have a we are at the beginning of that benefit of Operational. As we grow our revenues, we are not going to grow our R and D and quality staff proportionately. as we grow our revenues we are not going to grow our r and d and quality staff proportionately We are going to increase other expenditure proportionately. we are going to increase other expenditure proportionately If you look at when our revenue was net, cost of employees went up to 17%. if you look at when our revenue was net cost of employees went up to 17% It is sometimes it was down 10%. it is sometimes it was down 10% So we have a we are at the beginning of that benefit of Operational. so we have a we are at the beginning of that benefit of operational Operational efficiency. Yeah. Once we improve revenues, our percentage of expenditure will come down. So that is another metric which will help us to improve our numbers, EBITDA as well as return on capital. Operational efficiency. operational efficiency Yeah. yeah Once we improve revenues, our percentage of expenditure will come down. once we improve revenues our percentage of expenditure will come down So that is another metric which will help us to improve our numbers, EBITDA as well as return on capital. so that is another metric which will help us to improve our numbers ebitda as well as return on capital

Speaker 8: Sir, my question was more on the non CDMO gross margin. Sir, my question was more on the non CDMO gross margin. sir my question was more on the non cdmo gross margin Is that is that non is that business mix changing that it can see a significant uptick from what was the historical peak on the gross margin? Because that will directly flow to EBITDA and factor also in that sense. So is the business model changing where we can see a higher peak gross margin in non CDMO peak? Is that is that non is that business mix changing that it can see a significant uptick from what was the historical peak on the gross margin? is that is that non is that business mix changing that it can see a significant uptick from what was the historical peak on the gross margin Because that will directly flow to EBITDA and factor also in that sense. because that will directly flow to ebitda and factor also in that sense So is the business model changing where we can see a higher peak gross margin in non CDMO peak? so is the business model changing where we can see a higher peak gross margin in non cdmo peak

Speaker 3: Adi, there is no business mix change. There's only product change. Adi, there is no business mix change. adi there is no business mix change There's only product change. there's only product change In some products, we get more margins. Maybe we might have shifted in this quarter. So it is fundamentally the business is not changing Okay, great. In some products, we get more margins. in some products we get more margins Maybe we might have shifted in this quarter. maybe we might have shifted in this quarter So it is fundamentally the business is not changing Okay, great. so it is fundamentally the business is not changing okay great

Speaker 8: Thank you and all the best. Thank you and all the best. thank you and all the best

Speaker 3: Thank you. Thank you. thank you

Speaker 1: Thank you. The next question is from the line of Nitin Agarwal from DAM Capital. Please go ahead. Thank you. thank you The next question is from the line of Nitin Agarwal from DAM Capital. the next question is from the line of nitin agarwal from dam capital Please go ahead. please go ahead

Speaker 2: Mister, thanks for taking the question. Doctor, on, you know, on the the CMO business which we have in both API and formulations, can you give us some color on, you know, we've not you know, when do you see momentum picking up on those pieces? Mister, thanks for taking the question. mister thanks for taking the question Doctor, on, you know, on the the CMO business which we have in both API and formulations, can you give us some color on, you know, we've not you know, when do you see momentum picking up on those pieces? doctor on you know on the the cmo business which we have in both api and formulations can you give us some color on you know we've not you know when do you see momentum picking up on those pieces Because it seems sudden flattening out of the API business in the formulation business, except the others also not seem to pick up much over the last few quarters. Because it seems sudden flattening out of the API business in the formulation business, except the others also not seem to pick up much over the last few quarters. because it seems sudden flattening out of the api business in the formulation business except the others also not seem to pick up much over the last few quarters

Speaker 3: It will pick up from q four onwards, Nitin. Yeah. It will pick up from q four onwards, Nitin. it will pick up from q four onwards nitin Yeah. yeah

Speaker 2: And this is driven by certain specific contracts or, you know, what will what will drive the timing from Q4 onwards on this on this? And this is driven by certain specific contracts or, you know, what will what will drive the timing from Q4 onwards on this on this? and this is driven by certain specific contracts or you know what will what will drive the timing from q4 onwards on this on this

Speaker 3: Right now, the tech transfer batches are going on in formulations. Right now, the tech transfer batches are going on in formulations. right now the tech transfer batches are going on in formulations And capacity enhancement is also going on permanently. So both we expect will be handy to get higher supplies and higher revenue from Q4 onwards. And capacity enhancement is also going on permanently. and capacity enhancement is also going on permanently So both we expect will be handy to get higher supplies and higher revenue from Q4 onwards. so both we expect will be handy to get higher supplies and higher revenue from q4 onwards

Speaker 2: And just for the APIs? And just for the APIs? and just for the apis

Speaker 3: API, what is happening with that contract, we are doing more integrated. So we are doing making API and converting that into formulations. API, what is happening with that contract, we are doing more integrated. api what is happening with that contract we are doing more integrated So we are doing making API and converting that into formulations. so we are doing making api and converting that into formulations So we may not have we don't expect under the contract manufacturing or API revenues will grow. We'll not grow to the extent formulations are growing. So we may not have we don't expect under the contract manufacturing or API revenues will grow. so we may not have we don't expect under the contract manufacturing or api revenues will grow We'll not grow to the extent formulations are growing. we'll not grow to the extent formulations are growing

Speaker 2: Got it. And sir, on the API business, ex of the ARVs, last year, we had a bit of a slump in the oncology part, I mean, till the time you were disclosing that. I mean, how do we see the non ARV API fees going forward? Got it. got it And sir, on the API business, ex of the ARVs, last year, we had a bit of a slump in the oncology part, I mean, till the time you were disclosing that. and sir on the api business ex of the arvs last year we had a bit of a slump in the oncology part i mean till the time you were disclosing that I mean, how do we see the non ARV API fees going forward? i mean how do we see the non arv api fees going forward Are we seeing momentum coming in that business at some point in time? Are we seeing momentum coming in that business at some point in time? are we seeing momentum coming in that business at some point in time

Speaker 3: Not in the next few quarters. Not in the next few quarters. not in the next few quarters

Speaker 2: And then what is the reason because of which there is there has been some challenge on this piece over the last? And then what is the reason because of which there is there has been some challenge on this piece over the last? and then what is the reason because of which there is there has been some challenge on this piece over the last

Speaker 3: It's not a challenge. It's that by size actually. It's not a challenge. it's not a challenge It's that by size actually. it's that by size actually The reason is we have allocated more resources to take up more CDMO projects in front of allocating to significant number to generic API development. So we took that as a decision made by internal people. I think we are also expanding our R and D strength. Once that is done, we will put resources back in development validation of generic API. We also need capacity to do that. The reason is we have allocated more resources to take up more CDMO projects in front of allocating to significant number to generic API development. the reason is we have allocated more resources to take up more cdmo projects in front of allocating to significant number to generic api development So we took that as a decision made by internal people. so we took that as a decision made by internal people I think we are also expanding our R and D strength. i think we are also expanding our r and d strength Once that is done, we will put resources back in development validation of generic API. once that is done we will put resources back in development validation of generic api We also need capacity to do that. we also need capacity to do that So there are multiple things. So right now, we made an informed decision internally to allocate resources to CDMO projects. So there are multiple things. so there are multiple things So right now, we made an informed decision internally to allocate resources to CDMO projects. so right now we made an informed decision internally to allocate resources to cdmo projects

Speaker 2: Okay. That makes sense. And then on the CDMO business, I think the question was asked earlier also. Okay. okay That makes sense. that makes sense And then on the CDMO business, I think the question was asked earlier also. and then on the cdmo business i think the question was asked earlier also So because even you've had three very strong consecutive quarters of the business, you know, the growth has come through sequentially for the last few quarters on a q o q basis. Now on this basis, how should we think about quarterly growth for for this business? Is it is it gonna be linear or we expect some lumpiness as we go forward? So because even you've had three very strong consecutive quarters of the business, you know, the growth has come through sequentially for the last few quarters on a q o q basis. so because even you've had three very strong consecutive quarters of the business you know the growth has come through sequentially for the last few quarters on a q o q basis Now on this basis, how should we think about quarterly growth for for this business? now on this basis how should we think about quarterly growth for for this business Is it is it gonna be linear or we expect some lumpiness as we go forward? is it is it gonna be linear or we expect some lumpiness as we go forward

Speaker 3: The overall, yes, we can comment. It's going to be healthy growth. The overall, yes, we can comment. the overall yes we can comment It's going to be healthy growth. it's going to be healthy growth

Speaker 2: Okay. And there's probably some volatility on a on a q o q basis as we go through the quarter. Okay. okay And there's probably some volatility on a on a q o q basis as we go through the quarter. and there's probably some volatility on a on a q o q basis as we go through the quarter

Speaker 3: We are not expanding that because of ARVs, some business we know very clear. See, it's not that we will get an order for CDMO in July and we deliver in September. It's not that. We are not expanding that because of ARVs, some business we know very clear. we are not expanding that because of arvs some business we know very clear See, it's not that we will get an order for CDMO in July and we deliver in September. see it's not that we will get an order for cdmo in july and we deliver in september It's not that. it's not that So it's a long term. We know very clear what molecule we're making, how much we're making, which is the customer or price and all, pretty well for this year. So we see comfortable and we expect good growth in CDM revenues overall for the year. So it's a long term. so it's a long term We know very clear what molecule we're making, how much we're making, which is the customer or price and all, pretty well for this year. we know very clear what molecule we're making how much we're making which is the customer or price and all pretty well for this year So we see comfortable and we expect good growth in CDM revenues overall for the year. so we see comfortable and we expect good growth in cdm revenues overall for the year

Speaker 2: And sir, if you can on on the on the CDM apart, many products are we supplying? How many have got I guess, this is the commercial supply at this point of time. And sir, if you can on on the on the CDM apart, many products are we supplying? and sir if you can on on the on the cdm apart many products are we supplying How many have got I guess, this is the commercial supply at this point of time. how many have got i guess this is the commercial supply at this point of time And typically, should we think about typically, given your pipeline, how many new products can get commercial typically on annual basis given a pipeline over the next couple of years? And typically, should we think about typically, given your pipeline, how many new products can get commercial typically on annual basis given a pipeline over the next couple of years? and typically should we think about typically given your pipeline how many new products can get commercial typically on annual basis given a pipeline over the next couple of years

Speaker 3: It's it's difficult. We we we don't want to get that number and confuse all the investors. So I think as we have you have mentioned, we have grown significantly in CDMO quarter on quarter for the last five quarters. And numbers only will speak. It's it's difficult. it's it's difficult We we we don't want to get that number and confuse all the investors. we we we don't want to get that number and confuse all the investors So I think as we have you have mentioned, we have grown significantly in CDMO quarter on quarter for the last five quarters. so i think as we have you have mentioned we have grown significantly in cdmo quarter on quarter for the last five quarters And numbers only will speak. and numbers only will speak That's what we we don't want to forecast our partner products. So when it comes here, we are telling we'll be around INR 2,500 crores plus RMA 200 crores. We have visibility there. In CMO and generic, we have visibility. In CDMO, we don't want to get and give a number. That's what we we don't want to forecast our partner products. that's what we we don't want to forecast our partner products So when it comes here, we are telling we'll be around INR 2,500 crores plus RMA 200 crores. so when it comes here we are telling we'll be around inr 2,500 crores plus rma 200 crores We have visibility there. we have visibility there In CMO and generic, we have visibility. in cmo and generic we have visibility In CDMO, we don't want to get and give a number. in cdmo we don't want to get and give a number

Speaker 2: Got it. And then in your opening last one on this on your opening comments, you made a few references to the fact that a lot of big pharma contracts are supplied has started or are scaling up, you know, for our CDMO business. I mean, so, sir, is this so if you can just probably set on the so, sir, when you highlight the big pharma part, know, how how should one read it? Is it essentially leading to larger contracts or or or these are more strategic partnerships? Got it. got it And then in your opening last one on this on your opening comments, you made a few references to the fact that a lot of big pharma contracts are supplied has started or are scaling up, you know, for our CDMO business. and then in your opening last one on this on your opening comments you made a few references to the fact that a lot of big pharma contracts are supplied has started or are scaling up you know for our cdmo business I mean, so, sir, is this so if you can just probably set on the so, sir, when you highlight the big pharma part, know, how how should one read it? i mean so sir is this so if you can just probably set on the so sir when you highlight the big pharma part know how how should one read it Is it essentially leading to larger contracts or or or these are more strategic partnerships? is it essentially leading to larger contracts or or or these are more strategic partnerships

Speaker 4: And Nitin Nitin, I think we are going I think it's late in the we cannot disclose more than what we have done on the yeah. And Nitin Nitin, I think we are going I think it's late in the we cannot disclose more than what we have done on the yeah. and nitin nitin i think we are going i think it's late in the we cannot disclose more than what we have done on the yeah

Speaker 2: Okay, Sure. No problem. Thank you, sir. Okay, Sure. okay sure No problem. no problem Thank you, sir. thank you sir

Speaker 3: Thank you. Thank you. Thank you. thank you Thank you. thank you

Speaker 1: The next question is from the line of from Bank of Varota. Please go ahead. The next question is from the line of from Bank of Varota. the next question is from the line of from bank of varota Please go ahead. please go ahead

Speaker 3: Mister, your line has been unmuted. Please go ahead with your question. Mister, your line has been unmuted. mister your line has been unmuted Please go ahead with your question. please go ahead with your question

Speaker 11: Yeah. Thank you for the opportunity, and congratulations on a very good set of numbers. There was one comment made on the CDMO side, which is very big that the contribution is now 30% of the sales, and we expect it to touch 50%. So can you give some more clarity on I mean, by when can we expect this kind of contribution to come in from CDMO? Yeah. yeah Thank you for the opportunity, and congratulations on a very good set of numbers. thank you for the opportunity and congratulations on a very good set of numbers There was one comment made on the CDMO side, which is very big that the contribution is now 30% of the sales, and we expect it to touch 50%. there was one comment made on the cdmo side which is very big that the contribution is now 30% of the sales and we expect it to touch 50% So can you give some more clarity on I mean, by when can we expect this kind of contribution to come in from CDMO? so can you give some more clarity on i mean by when can we expect this kind of contribution to come in from cdmo

Speaker 3: No. We mentioned we have the potential to go there, and we are not attaching any year to that. Okay. Yeah. Yeah. No. no We mentioned we have the potential to go there, and we are not attaching any year to that. we mentioned we have the potential to go there and we are not attaching any year to that Okay. okay Yeah. yeah Yeah. yeah

Speaker 11: But, like, somewhere in five years down the line, can we extend this kind of potential run rate? But, like, somewhere in five years down the line, can we extend this kind of potential run rate? but like somewhere in five years down the line can we extend this kind of potential run rate

Speaker 3: We're we're not giving any forecast there. We're we're not giving any forecast there. we're we're not giving any forecast there

Speaker 11: Okay. And secondly, on the ADC front, we have mentioned couple of times that we endeavor to go into the ADC side also. So may I ask which part of the ADC are we looking at? Is it the payloads, linkers, bioconjugation? Any color on that? Okay. okay And secondly, on the ADC front, we have mentioned couple of times that we endeavor to go into the ADC side also. and secondly on the adc front we have mentioned couple of times that we endeavor to go into the adc side also So may I ask which part of the ADC are we looking at? so may i ask which part of the adc are we looking at Is it the payloads, linkers, bioconjugation? is it the payloads linkers bioconjugation Any color on that? any color on that

Speaker 3: We already make payloads and linkers, and we don't want to make maps. We'll do conjugation, purification and fill finish. That's the infrastructure resources we are building. Internally, we'll make payloads, linkers and then do bioconjugation, purification and fill finish. We will not make math. We already make payloads and linkers, and we don't want to make maps. we already make payloads and linkers and we don't want to make maps We'll do conjugation, purification and fill finish. we'll do conjugation purification and fill finish That's the infrastructure resources we are building. that's the infrastructure resources we are building Internally, we'll make payloads, linkers and then do bioconjugation, purification and fill finish. internally we'll make payloads linkers and then do bioconjugation purification and fill finish We will not make math. we will not make math

Speaker 11: Okay. Got it. And out of this 5,000 crore CapEx that we have announced, would it be possible to give some color there, like how much of it would go towards the ADC side? Okay. okay Got it. got it And out of this 5,000 crore CapEx that we have announced, would it be possible to give some color there, like how much of it would go towards the ADC side? and out of this 5,000 crore capex that we have announced would it be possible to give some color there like how much of it would go towards the adc side

Speaker 3: ADC is will invite this new 5,000 CapEx is in WiZac. None of that CapEx will go to ADC side. ADC is will invite this new 5,000 CapEx is in WiZac. adc is will invite this new 5,000 capex is in wizac None of that CapEx will go to ADC side. none of that capex will go to adc side

Speaker 11: Okay. Got it. Thank you. Thank you. Okay. okay Got it. got it Thank you. thank you Thank you. thank you

Speaker 1: Thank you. The next question is from the line of Gaurav from Antique Stockbroking. Please go ahead. Thank you. thank you The next question is from the line of Gaurav from Antique Stockbroking. the next question is from the line of gaurav from antique stockbroking Please go ahead. please go ahead

Speaker 12: Yeah. Hi. Hi. Thank you. Yeah. yeah Hi. hi Hi. hi Thank you. thank you

Speaker 3: Doctor, good evening. Doctor, good evening. doctor good evening

Speaker 12: This quarter, we've seen a significant jump in your employee expenses, almost 23%, 21% quarter on quarter, year on year. Any nonrecurring expenses here or this is the new base? This quarter, we've seen a significant jump in your employee expenses, almost 23%, 21% quarter on quarter, year on year. this quarter we've seen a significant jump in your employee expenses almost 23% 21% quarter on quarter year on year Any nonrecurring expenses here or this is the new base? any nonrecurring expenses here or this is the new base

Speaker 4: The part is nonrecurring. In the sense, once in a year you will get, actually we are giving a long term service awards for the people who stayed us for a longer period. And of course, there is an increment over the last year, last quarter, that's also reflected apart from the additional manpower. The part is nonrecurring. the part is nonrecurring In the sense, once in a year you will get, actually we are giving a long term service awards for the people who stayed us for a longer period. in the sense once in a year you will get actually we are giving a long term service awards for the people who stayed us for a longer period And of course, there is an increment over the last year, last quarter, that's also reflected apart from the additional manpower. and of course there is an increment over the last year last quarter that's also reflected apart from the additional manpower

Speaker 12: So quarter on quarter, we may see some decline in Q2, right, from this I don't say decline, but it will not have that kind of an increase. So quarter on quarter, we may see some decline in Q2, right, from this I don't say decline, but it will not have that kind of an increase. so quarter on quarter we may see some decline in q2 right from this i don't say decline but it will not have that kind of an increase

Speaker 4: We're also expanding our team strength. We're also expanding our team strength. we're also expanding our team strength So we keep on recruiting more and more to our expanded base. So it will maybe you can consider that as a new norm maybe. So we keep on recruiting more and more to our expanded base. so we keep on recruiting more and more to our expanded base So it will maybe you can consider that as a new norm maybe. so it will maybe you can consider that as a new norm maybe

Speaker 12: It. Thank you. On the ARV side, we've seen, you know, growth this quarter, year on year growth in this quarter, but you're still maintaining your guidance of, you know, no growth for an overall full year basis. It. it Thank you. thank you On the ARV side, we've seen, you know, growth this quarter, year on year growth in this quarter, but you're still maintaining your guidance of, you know, no growth for an overall full year basis. on the arv side we've seen you know growth this quarter year on year growth in this quarter but you're still maintaining your guidance of you know no growth for an overall full year basis Any particular reason, you know, why still you're not seeing growth in this segment for the full year? Is it just uncertainty on the global tender? Any particular reason, you know, why still you're not seeing growth in this segment for the full year? any particular reason you know why still you're not seeing growth in this segment for the full year Is it just uncertainty on the global tender? is it just uncertainty on the global tender

Speaker 3: We kept some margin, see. We have seen significant price drop in ARVs. If there is no price drop, we may go little bit better. We kept some margin, see. we kept some margin see We have seen significant price drop in ARVs. we have seen significant price drop in arvs If there is no price drop, we may go little bit better. if there is no price drop we may go little bit better If there is a price drop, our incremental volumes will compensate the price drop. So we are keeping that cushion when we are committing 25 INR plus or minus INR 200 crores. That's the reason we kept that to delta. If there is a price drop, our incremental volumes will compensate the price drop. if there is a price drop our incremental volumes will compensate the price drop So we are keeping that cushion when we are committing 25 INR plus or minus INR 200 crores. so we are keeping that cushion when we are committing 25 inr plus or minus inr 200 crores That's the reason we kept that to delta. that's the reason we kept that to delta

Speaker 1: Mr. Gaurav, does that answer your question? Hello? Mr. Gaurav, does that answer your question? mr gaurav does that answer your question Hello? hello

Speaker 3: It must be dropped off. It must be dropped off. it must be dropped off

Speaker 1: Yes, sir. We'll move on to the next question. It's from the line of Yashir. Please go ahead. Yes, sir. yes sir We'll move on to the next question. we'll move on to the next question It's from the line of Yashir. it's from the line of yashir Please go ahead. please go ahead

Speaker 7: Greetings, sir. You know, what like some qualitative inputs in terms of CDMO business? Is it large volume sort of chronic drug? Is it are they in the rare or orphan space? Greetings, sir. greetings sir You know, what like some qualitative inputs in terms of CDMO business? you know what like some qualitative inputs in terms of cdmo business Is it large volume sort of chronic drug? is it large volume sort of chronic drug Is it are they in the rare or orphan space? is it are they in the rare or orphan space Secondly, also, what could be our mix between, say, big pharma and small biotech on the CDMO business? Secondly, also, what could be our mix between, say, big pharma and small biotech on the CDMO business? secondly also what could be our mix between say big pharma and small biotech on the cdmo business

Speaker 3: We can't give you therapeutic mix of our CDMO revenue. Yes. But the majority of revenues are coming from medium and big pharma, very less from small and virtual biotechs. And if you're not audible, Are we the primary source in these cases or are we like, you know, are these projects where, you know, big pharma customers want to diversify the supply and we are probably a a second source, you know, any sort of pricing that could be helpful? We can't give you therapeutic mix of our CDMO revenue. we can't give you therapeutic mix of our cdmo revenue Yes. yes But the majority of revenues are coming from medium and big pharma, very less from small and virtual biotechs. but the majority of revenues are coming from medium and big pharma very less from small and virtual biotechs And if you're not audible, Are we the primary source in these cases or are we like, you know, are these projects where, you know, big pharma customers want to diversify the supply and we are probably a a second source, you know, any sort of pricing that could be helpful? and if you're not audible are we the primary source in these cases or are we like you know are these projects where you know big pharma customers want to diversify the supply and we are probably a a second source you know any sort of pricing that could be helpful I think those insights are very difficult to divert. I'm sorry. I think those insights are very difficult to divert. i think those insights are very difficult to divert I'm sorry. i'm sorry

Speaker 7: No. No. No worries. Ten months to your entire deal. Thank you. No. no No. no No worries. no worries Ten months to your entire deal. ten months to your entire deal Thank you. thank you

Speaker 10: Thank you. Yeah. Thank you. thank you Yeah. yeah

Speaker 1: The next question is from the line of Abhijit, an individual investor. Please go ahead. The next question is from the line of Abhijit, an individual investor. the next question is from the line of abhijit an individual investor Please go ahead. please go ahead

Speaker 7: Yes. Thank you for the second round of opportunity. I have a question with regards to the debt. Yes. yes Thank you for the second round of opportunity. thank you for the second round of opportunity I have a question with regards to the debt. i have a question with regards to the debt So the net debt for EBITDA right now is 1.8. Obviously, it's come down because your EBITDA has gone up. What is the management's guidance for the debt over the next two years or next three years? So the net debt for EBITDA right now is 1.8. so the net debt for ebitda right now is 1.8 Obviously, it's come down because your EBITDA has gone up. obviously it's come down because your ebitda has gone up What is the management's guidance for the debt over the next two years or next three years? what is the management's guidance for the debt over the next two years or next three years

Speaker 4: We are not expecting significant increase in the debt. So we will manage in the as we said, we try to manage with 50% of our revenue levels, the annual revenue levels. We are not expecting significant increase in the debt. we are not expecting significant increase in the debt So we will manage in the as we said, we try to manage with 50% of our revenue levels, the annual revenue levels. so we will manage in the as we said we try to manage with 50% of our revenue levels the annual revenue levels That means EBITDA, debt by EBITDA maybe two, two point five is max. That means EBITDA, debt by EBITDA maybe two, two point five is max. that means ebitda debt by ebitda maybe two two point five is max

Speaker 7: Okay. So two, two point five is the maximum net EBITDA to debt levels. But the INR 5,000 crores that you're going to plan to do in the I presume, next three to four years. Right? You will not do it overnight. Okay. okay So two, two point five is the maximum net EBITDA to debt levels. so two two point five is the maximum net ebitda to debt levels But the INR 5,000 crores that you're going to plan to do in the I presume, next three to four years. but the inr 5,000 crores that you're going to plan to do in the i presume next three to four years Right? right You will not do it overnight. you will not do it overnight

Speaker 3: It will take three to four years. Four to five. Four to you're going to okay. It will take three to four years. it will take three to four years Four to five. four to five Four to you're going to okay. four to you're going to okay

Speaker 7: Four to five years, you are going what is the breakup? Four to five years, you are going what is the breakup? four to five years you are going what is the breakup Like, are you going to do internal accruals or you're planning to do more JVs with other minor companies or you want to do mostly everything yourself? Like, are you going to do internal accruals or you're planning to do more JVs with other minor companies or you want to do mostly everything yourself? like are you going to do internal accruals or you're planning to do more jvs with other minor companies or you want to do mostly everything yourself

Speaker 4: Mostly mostly for the from the Laureus Lab side and majority of funding will be through internal approvals. Mostly mostly for the from the Laureus Lab side and majority of funding will be through internal approvals. mostly mostly for the from the laureus lab side and majority of funding will be through internal approvals

Speaker 7: Okay. And another question is with regards to the business strategy. Are you looking at more opportunity because of this tariff tantrum that is happening around in The U. Okay. okay And another question is with regards to the business strategy. and another question is with regards to the business strategy Are you looking at more opportunity because of this tariff tantrum that is happening around in The U. are you looking at more opportunity because of this tariff tantrum that is happening around in the u S? I know that Lotus does not have a large amount of exposure to The U. S. Market directly apart from the generics. In the other premium more, I would say, complex drug products, is there any opportunity that is coming about? S? s I know that Lotus does not have a large amount of exposure to The U. i know that lotus does not have a large amount of exposure to the u S. s Market directly apart from the generics. market directly apart from the generics In the other premium more, I would say, complex drug products, is there any opportunity that is coming about? in the other premium more i would say complex drug products is there any opportunity that is coming about Are there any meetings going on with the large companies? Are there any meetings going on with the large companies? are there any meetings going on with the large companies

Speaker 4: No. No. no

Speaker 3: No. No. no

Speaker 7: Okay. Thank you. Thank you. Best of luck. Okay. okay Thank you. thank you Thank you. thank you Best of luck. best of luck

Speaker 3: Thank you. Thank you. thank you

Speaker 1: Thank you. The next question is from the line of Gavan Tareja from ASK Investment Managers. Please go ahead. Thank you. thank you The next question is from the line of Gavan Tareja from ASK Investment Managers. the next question is from the line of gavan tareja from ask investment managers Please go ahead. please go ahead

Speaker 13: Good evening. Hi. Hope I'm audible. Good evening. good evening Hi. hi Hope I'm audible. hope i'm audible

Speaker 3: Yes, you're audible. Yes, you're audible. yes you're audible

Speaker 13: Yes. Sir, the first question is on the CDMO piece. Is it possible to understand within CDMO revenue breakdown in terms of what is coming from commercial supplies and what is coming from Phase one, Phase two, Phase three? And how that will evolve over the next two, three years? Yes. yes Sir, the first question is on the CDMO piece. sir the first question is on the cdmo piece Is it possible to understand within CDMO revenue breakdown in terms of what is coming from commercial supplies and what is coming from Phase one, Phase two, Phase three? is it possible to understand within cdmo revenue breakdown in terms of what is coming from commercial supplies and what is coming from phase one phase two phase three And how that will evolve over the next two, three years? and how that will evolve over the next two three years

Speaker 3: We are not dissecting those numbers into commercial Phase III, Phase II, Phase I and customers. We are not dissecting those numbers into commercial Phase III, Phase II, Phase I and customers. we are not dissecting those numbers into commercial phase iii phase ii phase i and customers That's we can't divulge customer and product. So afraid we can't give you that data. That's we can't divulge customer and product. that's we can't divulge customer and product So afraid we can't give you that data. so afraid we can't give you that data

Speaker 13: Okay. So, okay, the second question is, as the percentage of CDMO in your total sales sizes and since CDMO is a higher gross margin business for you, is it reasonable to assume that it will have, you know, it will take the aggregate or average margin, overall margin or trajectory of the company upward? Okay. okay So, okay, the second question is, as the percentage of CDMO in your total sales sizes and since CDMO is a higher gross margin business for you, is it reasonable to assume that it will have, you know, it will take the aggregate or average margin, overall margin or trajectory of the company upward? so okay the second question is as the percentage of cdmo in your total sales sizes and since cdmo is a higher gross margin business for you is it reasonable to assume that it will have you know it will take the aggregate or average margin overall margin or trajectory of the company upward

Speaker 3: Yes. Yes. yes The contribution and percentage from CDMO gross, we expect both gross margin and EBITDA margins should continue to go up. The contribution and percentage from CDMO gross, we expect both gross margin and EBITDA margins should continue to go up. the contribution and percentage from cdmo gross we expect both gross margin and ebitda margins should continue to go up

Speaker 13: Alright. And sir, final one is, on the ARVs, Lena Capraveer and Cavotekawir both have issued voluntary licenses. Even WHO today now seems to stand very strongly behind bringing in lanacapavir, advocating for lanacapavir as as probably the preferred treatment and bringing it in in the emerging markets as well via the voluntary license route. So first question is, would LORUS have an opportunity in lenacaparib? Alright. alright And sir, final one is, on the ARVs, Lena Capraveer and Cavotekawir both have issued voluntary licenses. and sir final one is on the arvs lena capraveer and cavotekawir both have issued voluntary licenses Even WHO today now seems to stand very strongly behind bringing in lanacapavir, advocating for lanacapavir as as probably the preferred treatment and bringing it in in the emerging markets as well via the voluntary license route. even who today now seems to stand very strongly behind bringing in lanacapavir advocating for lanacapavir as as probably the preferred treatment and bringing it in in the emerging markets as well via the voluntary license route So first question is, would LORUS have an opportunity in lenacaparib? so first question is would lorus have an opportunity in lenacaparib

Speaker 3: Are not part of the licensee of lenacaparib. And lamacopril will be part of the guidelines for prevention rather than the treatment. That's one. And cabotegravir, delpivirine, we have developed API, and we have a few partners using our APIs. Lanka, we are not part of the licensee. Are not part of the licensee of lenacaparib. are not part of the licensee of lenacaparib And lamacopril will be part of the guidelines for prevention rather than the treatment. and lamacopril will be part of the guidelines for prevention rather than the treatment That's one. that's one And cabotegravir, delpivirine, we have developed API, and we have a few partners using our APIs. and cabotegravir delpivirine we have developed api and we have a few partners using our apis Lanka, we are not part of the licensee. lanka we are not part of the licensee

Speaker 13: Okay. Okay. Thank you, sir. I'll get back in the queue. Thanks for taking my question. Okay. okay Okay. okay Thank you, sir. thank you sir I'll get back in the queue. i'll get back in the queue Thanks for taking my question. thanks for taking my question

Speaker 1: Thank you. Ladies and gentlemen, that was the last question for today's conference call. I now hand the conference over to the management for their closing comments. Thank you, Nitin and DAM team for working this Q1 investor conference call. And thanks for asking very pertinent questions, all the stakeholders. Thank you. thank you Ladies and gentlemen, that was the last question for today's conference call. ladies and gentlemen that was the last question for today's conference call I now hand the conference over to the management for their closing comments. i now hand the conference over to the management for their closing comments Thank you, Nitin and DAM team for working this Q1 investor conference call. thank you nitin and dam team for working this q1 investor conference call And thanks for asking very pertinent questions, all the stakeholders. and thanks for asking very pertinent questions all the stakeholders

Speaker 4: Thank you. Thank you. thank you

Speaker 3: Thank you. Thank you. thank you

Speaker 1: Thank you. On behalf of DAM Capital, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you. Thank you. thank you On behalf of DAM Capital, that concludes this conference. on behalf of dam capital that concludes this conference Thank you for joining us, and you may now disconnect your lines. thank you for joining us and you may now disconnect your lines Thank you. thank you