Laurus Labs Limited — Call Transcript 2026

Ladies and gentlemen, good day and welcome to the Laurus Labs 3Q FY 2026 Earnings Conference Call hosted by DAM Capital Advisors Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on the touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Nitin Agarwal from DAM Capital Advisors Limited. Thank you, and over to you, Mr. Nitin. Thank you so much. Good afternoon, everyone, and a very warm welcome to Laurus Labs Q3 FY 2026 earnings call hosted by DAM Capital Advisors Limited. On the call today, we have representing Laurus Labs management, Dr. Satyanarayana Chava, Founder and CEO, Mr. V. V. Ravi Kumar, Executive Director, Mr. Krishna Chaitanya Chava, ED, Head CDMO, Mrs. Soumya Chava, ED, Generics and Commercial, and Mr. Vivek Kumar, AVP Investor Relations. Before we proceed, I would like to remind you that some of the statements made during the call today could be forward-looking in nature, and a safe harbor statement to this effect has been included in the press release that has been shared on the company's website. I hand over the call now to Dr. Chava to make the opening comments, and then we'll open the floor for questions. Please go ahead, sir. Thank you, Nitin. Good afternoon, everyone. We continue to execute our strategy to advancement of important clinical and commercial programs with global partners, successful ramp-up of new launches, and strengthening our leadership in the ARV segment. Our large-scale development and manufacturing capabilities across small molecule as well as large molecule offering continue to gain traction with multiple partners. We are seeing a healthy level of interest across technologies and scale from our long-term existing partnerships. We are confident that we are investing in interesting technology platforms, many of those already underway. Successful execution on these projects will continue to transform our business portfolio and drive future growth. Some of the notable progress I wish to highlight: we made significant investments in CapEx so far in peptide development and manufacturing infrastructure to meet our current and future capacity requirements. In addition, we operationalized our antibody-drug conjugate and gene therapy process development labs in Hyderabad this quarter, and the construction of GMP manufacturing facility is well on track. Last month, we also announced an increase in giant investments in KRKA, which is in line with our plan to support ongoing FDA facility construction in Hyderabad. Phase I is expected to be completed by mid-2027. Moving on to financial results, we delivered another quarter of strong operational and financial performance. Revenues for the third quarter stood at INR 1,778 crores. Gross margins have expanded further from the previous quarters and maintained around 60%. EBITDA margins expanded to a little over 27%. To achieve these numbers through strong performance across our generic business and also clinical and commercial supplies of CDMO programs to our partners. Our product mix within business division and operating leverage have continued to do well in supporting our healthy margins overall. As we look forward, we remain well on track to deliver healthy operational growth for the entire financial year 2026. Now, I would like to request Mr. Nitin to share key updates on our CDMO business. Thank you. Yeah. On the CDMO side, we continue to see strong interest in our integrated service offerings across various complex technology platforms. Our cumulative nine-month performance has been very healthy, clocking more than 50% growth. This has been supported by strong recurring business from our existing long-term customer relationships across various different scales. Now, in the small molecule space, our Q3 sales have been at INR 408 crore. I would say this performance is in line with our expectation due to phasing of deliveries in the coming quarters involving very long and complex synthetic processes. Pipeline momentum has remained very healthy with a well-balanced mix of big pharma clientele and also mid and small-sized biotechs. The majority of the pipeline programs under execution utilize several advanced technology platforms. In line with that, we continue investment for large-scale capacity expansion in our WSAC sites and expanding our capabilities, including peptides, flow, high-energy chemistries, purifications, etc. Now, on the bio division side of things, Q3 sales have been reported at INR 43 crore. The performance has been a bit muted, but we are seeing better and longer visibility on demand projections and executing longer campaigns on the CDMO side. Additionally, our AOF business is clocking healthy operational progress with continuing customer interest for dedicated lines. Construction work for the commercial-scale fermentation facility at WSAC is progressing in line with the plan, and we expect a phase I capacity of a little over 400 kiloliters to be operational towards the end of 2026. Thank you, Krishna. I would request Mrs. Soumya Chava to share key updates on our generic business. Thank you. The revenues from the generic division have continued to perform well, reporting growth of 37% to INR 1,327 crores for quarter three. For the nine-month period, we achieved sales of INR 3,510 crores, reflecting growth of 26%. The growth has been supported by higher ARV volumes and, more specifically, by strong offtake in recently launched products in the developed markets. We continue to see stability from the established product portfolio and expect the benefits to continue, at least in the near term. The broad API market portfolio and production capacity in the ARV business continue to be fully optimized, ensuring that we are well-positioned to support additional orders as and when they arrive. This positions us well to meet customer requirements. The overall solid facility expansion is progressing well. A significant part of the planned capacity became operational during the quarter and is currently undergoing ramp-up activities in line with the plan. Cumulatively, 92 DMFs have been filed to date. In developed markets, four formulation doses have been filed and five approvals received during the nine-month period. Overall, 91 products have been filed cumulatively to date. Thank you. Thanks, Krishna and Soumya for the overview of generics and CDMO business. On the R&D front, overall R&D spending was at 4.1% of our sales for the nine months. The peptide research increased by 8% year-on-year, including our spend on the energy benefit space. This R&D spend is in line with our full-year target, and we continue to invest in portfolio focusing on product complexity, scale, and sustainable and new technology platforms. Let me share a brief one on the quality side. In the nine months, the company underwent close to 110 quality audits by multiple drug regulatory agencies and several customers. The company has successfully passed audit inspections without any critical findings. On the ESG front, one of the leading agencies, S&P Global, has published its 2024 ESG score, in which Laurus reported an impressive 10 percentage point increase in the score, achieving 81 out of 100 points. This reflects our continued commitment to sustainable development and exceptional performance in ESG practices as we move along. Now, I request Mr. Ravi Kumar to share overall financial highlights. Yeah, thank you, Dr. Satya, and very warm welcome to everyone for this quarter three and nine-month FY 2026 earnings call. Total income from operations for the nine months came at around INR 5,001 crores. We just crossed INR 5,000 crores in nine months' time, registered a growth of 30%. We have continued to deliver strong growth mainly due to sustained ARV business momentum, strong CDMO, and growth in other generic business. For the quarter three, total income from operations was at INR 1,778 crores, with a 26% growth. Gross margin maintained healthy way for nine months at 60.1%, and for quarter three, it is at 60.9%, mainly due to better product and division mix and continued process improvement efforts. EBITDA for nine months stands at INR 1,303 crores, with a margin of 26.1%. It is well within our early-year guided range. For quarter three, EBITDA reported at INR 485 crores, with a margin of 27%, due to strong operational leverage. Profit after tax at nine months: INR 610 crores. It's a growth of 388%, and for quarter three, INR 252 crores. ROCE has improved to 18.5%. If you look at the last three quarters, it is progressively improving. On the CapEx front, we invested about INR 246 crores for the quarter, and cumulatively for nine months, it is INR 735 crores. Our net debt stood at INR 2,092 crores, which is a similar range of quarter-ended September, and debt to EBITDA has further decreased to around 1.2. On the capital allocation front, our strategy remains unchanged, and we will continue to prioritize investments into high-value business segments to drive near and long-term growth and return for our shareholder over a period of time. To conclude, as we will finish the year, we are confident in delivering growth and ongoing focus on execution. We remain well-positioned to drive long-term growth. You can refer to our IR presentation for more details. With this, I would request the moderator to open the lines for a few minutes. Thank you. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Tushar Manudhane from Motilal Oswal Financial Services. Please go ahead. Thanks for the opportunity and congrats on a good set of numbers. Just first, to start with, a question in terms of, could you break down ARV sales into formulations and API. Hello. Yeah, I'm just answering. In the nine months, API is INR 86 crores. The formulation is INR 865 crores ARV. In the API, it is INR 1,259 crores. Sorry, how much? How much is the API? Tushar, these numbers can be. It is there in the IR, or I, Vivek, can give it to you, Tushar. You can ask any qualitative question. The total ARV revenues were INR 744 crores for the quarter three. Got it. So secondly, on the CapEx side, this nine month CapEx is largely more than what we would have done in FY 2025. And then we have certain contracts made on the peptide side or now in ADC. So firstly, how much one can think about investment into peptides as an asset over, let's say, the next 12-24 months? And ADCs as well, if you could. And then thirdly, on the overall CapEx for 2027. The ADC is still at the nascent stage right now. We have allocated $25 million to the GMP facility, which is under construction right now. We don't expect any meaningful revenues coming from ADCs in the next two years. When it comes to CDMO investment in peptide commercial manufacturing facilities, we expect qualification during this calendar year. We will give you more details as and when we are in a position to give feedback to you. For overall CapEx? Overall CapEx this year will be about INR 1,000 crores in FY 2026. FY 2026, based on the current estimate, we do feel it will be over INR 1,000 crores next year also. This will be largely done with keeping net debt at similar number? Maybe debt may be increased slightly if it's needed, but your debt by EBITDA will be in a better way. Got it. And just one last from my side, if you could at least just share in terms of pecking order the gross margin for different segments like API, synthesis, FBF? I'm not giving that segment-wise gross margin details, but it is everybody's guess. Yeah. Qualitatively, while not a specific number, but directionally if you have to think about, is FBF, synthesis at a similar gross margin, API at a lower gross margin? Is that the way to think about? Tushar, the order remains same. CDMO, formulation, API. This is an order. API on the lower side, formulation on the higher side, and CDMO is on the top. Because sequentially, we see quarter-to-quarter, there has been improvement in gross margin, while the share of formulation has increased considerably in this quarter compared to the previous quarter, which is why I was trying to understand. In fact, synthesis share has reduced, and even API share has increased, which is why I was just trying to understand if there was anything to look into as far as gross margin for the quarter is concerned. I think the order remains same, Tushar. I think, you see, there is a product mix within the same segment, some products where higher margins were there. So there is, see, if you look at last quarter, also we had the similar gross margin. This quarter also, gross margin. And we expect to maintain gross margins of 60%, around 60%, for the coming quarter and also next financial year. Okay, sir. That's it from my side. Thank you and all the best. Thank you. Next question is from the line of Rehan Saiyyed from Trinetra Asset Management. Please go ahead. Yeah, good evening to the team, and congratulations for a good set of numbers, and thank you for giving me the opportunity. So, sir, I have a couple of questions. First, on the CDMO side, CDMO grew 88% in H1 FY 2026-based management and repeatedly warned that this business is lumpy. So your consolidated quarter three revenue grew only 7.5% sequentially over quarter two. So my question here is, your CDMO growth in H1 was phenomenal due to late space, MCU deliveries. However, looking at the sequential revenue growth in quarter three, so it seems the lumpiness might be entering at a plateau. Is the revenue we see in quarter three the new sustainable quarterly base for CDMO, or did this quarter include a significant portion of registration batches or large quantities that might not repeat in quarter four or quarter of FY 2027? This is my first question. See, CDMO revenues, if you look at the overall year, nine months, we have grown significantly. We are also confident that the growth will continue like this. Although the Q3 was a little softer because of timing of deliveries to our partners. We expect the—if you look at Q4 FY 2025 versus Q4 FY 2026, we expect to grow. Okay. We request you to take annual revenue then a quarter-on-quarter for the CDMO. Okay. Fair enough. Fair enough. And sir, my second question is around the OpEx burn on specialized modalities. So with the impressive PAD growth this quarter, the burn from specialized modalities like CGT and ADC is less visible. So however, as an analyst, I want to understand the core efficiency. Could you quantify the specific quarterly EBITDA drive from these non-revenue-generating activities? And furthermore, since you now recruited new leadership for ADCs, so is the INR 250 crore budget still sufficient, or should we expect an upward revision in OpEx as you move towards bioconjugation and fill-finish capabilities? That's a Laurus philosophy we were informed about a lot of our investment companies. None of them are not clearly audited. None of these pre-operative expenditures or any of our new initiatives is capitalized. So every new modality expenditure is expensed. So in the ADC space, we are investing significantly both in OpEx and CapEx, but that is going through the balance sheet. We are not capitalizing it. Okay. Coming to your question of the team, actually, we have a separate team identified, a guy who is relocated from U.S. to India to take care of the ADC and then Noorjeen Dhilpe. Okay. Okay. And my last question is on the ROC and ROE guidance that you have given in the last quarter. But management has highlighted that the company's current size can absorb the INR 1,000 crore annual CapEx better than in the past. So however, with the groundbreaking of $5.6 billion by Vizag Complex and the current turnovers of 0.9, so aren't we risking another multi-year period of operating de-leverage? Specifically, if your Bengal Bio capacity is sold out until end 2026, and new Vizag capacities are also a year away, so from this specific division, will it be incremental turnover came to bridge the gap to your 1.1 asset turnover and 25% ROC target in the next 12 months? I think in case of bio, our revenues will stagnate until we operationalize our new capacity, which will be by the end of this calendar year. We are not committing that we will achieve a ROC of 25% in the next 12 months, but we are confident that the ROC percentage will go up from the current 18%. Sir, you have said 18%, right? Right now, it's 18%. Right now, it's 18.5% ROC. We expect to go up, but we are not committing it will go to 25 with a time-bound program. Yeah. Okay. So we are not putting any numbers here? Yes. Okay. Okay. Fair enough. Thank you. That's it from my side. Thank you. The next question is from the line of Sajal Kapoor from Antifragile Thinking. Please go ahead. Yeah. Hi. Thank you for taking my question, and good afternoon, team. It's heartening to see a very strong jump in the operating cash flow. I'm looking at the nine-month number. It's about 600% increase. But there is an interesting trend here, Raviji, if you can elaborate and help us better understand this wider picture. So if I look at the 10-year data, so I'm looking at 2016 to 2025 cumulative, we clocked an EBITDA of INR 8,500 crores. And against that EBITDA of INR 8,500 crores, we did an operating cash flow of about INR 5,400 crores. So that's about 63% conversion. Whereas in the nine months, the conversion is 113%. So 63% going to 70%, 75%, even 80% is understandable. There is a definite change in the net working capital strategy. As far as I can understand, if you could just help us double-click and understand a more longer-term and more sustainable conversion of EBITDA into operating cash flow. Thank you. Sajal, thanks for your very interesting question. So this kind of help happened because of some of the customer advances which helped this year. But of course, if you look at the absolute number of the NWCs close to the similar number for the March and December, but the revenue has increased. That's really helped. But you are right, from 63% to 80%, 90%, but beyond that, actually, some part is helped through customer advances. Thank you for your in detail understanding. Sure, Raviji. Just to harp on that one, so given that the business characteristic is definitely changing in the favor of CDMO, and these customer advances will be an ongoing thing, we cannot compare quarter-over-quarter for advances because in one year, the advance may be higher than the other year. But on a broader five-year basis for the going forward five years, I think the conversion should be a lot better than what we have delivered in the last 10 years. Is that a fair assumption? Yeah, that's a fair assumption. Okay. Thank you. Thank you. My second question is for you, Dr. Satya. Where not to go or what not to do is also equally important because businesses have got finite cash flows and capabilities. So in that context, what is that one area where Laurus has chosen not to grow despite opportunity looking very interesting in the near term? Very thought-provoking question you asked, Sajal. See, right now, we decide not to enter into large-scale mAb manufacturing. We don't want to do that. That area, we decide not to get in. The other area we decide not to enter right now is also sterile manufacturing. These two areas we decide not to enter. Although opportunity looks good, but we also need to understand our management bandwidth to handle many things. So we know right now we are busy with what we are handling. We have visibility about our growth plans in the next two, three, four, five years. So we are cautious in the areas where we wanted to enter and deploy our resources, both material and money. Yeah. That's understandable, Laurus Satya, because if you look at India, I've seen many large sterile and mAb monoclonal antibody players. One of the leaders in that space are struggling when it comes to their balance sheet and the ROCE profile. So completely understand that strategy, and thank you for clarifying. Thank you. That's all from my side. Thank you. Thank you. The next question is from the line of Mehul Panjwani from 40 Cents. Please go ahead. Hello, sir. Thank you so much for the opportunity and congratulations on a great set of numbers. Sir, if you can elaborate a little bit on that, that is my first question. On the joint venture with KRKA, can you please elaborate what are we doing? Because I am not tracking. I'm recently tracking this company. The joint venture with KRKA is to manufacture formulations for the European market where APIs will be supplied by us. In the phase I, we are creating 3 billion solid oral capacity and 100 million solid oral capacity for potent molecules. In the phase II, we will create another 5 billion tablet capacity in the solid oral space. Phase I, we expect to complete by mid-2027. This unit will primarily do formulations packaging for various European markets and also some markets in Asia Pacific as well. Right, sir. Thank you, sir. And the second question is on cell and gene update, gene therapy. If you can highlight or elaborate what kind of revenues will kick in and what are we trying to achieve for a layman who understands a little bit about pharma, it will be helpful. Thank you. In the cell therapy, our associate company, ImmunoAct, is already having commercial revenues. When it comes to gene therapy, we are at very initial stage of investments in antibody drug conjugation gene therapy. Our process development labs were operationalized, and the GMP facilities will come in the next 12 months. We don't expect any revenues from ADCs and gene therapy, at least in the next 24 months. Right, sir. And what about the joint venture with KRKA? We will have revenues in the next financial, not in this financial year. Yeah. Okay. Thank you so much, sir. Thank you. All the best. Thank you. Thank you. Ladies and gentlemen, we request you to please use handsets while asking a question. The next question is from the line of Chirag Shah from White Pine Investment Management. Please go ahead. Mr. Chirag, please go ahead with your question. Your line is unmuted. Hello. Am I audible? Yes, you are. Please go ahead. Yeah. So first question is both for CDMO as well as for API and FDF business. Q1, Q1, YOY, if you can just highlight, is there anything with respect to volume and pricing, especially in API and FDF? Have we benefited on pricing in API and FDF? In the API, FDF, we predominantly benefited from the volume gain. Okay. Okay. So pricing has not really changed much, correct? Pricing hasn't played a significant role in this. The volume gain was significant. Was the main reason. Okay. Sir, second follow-up, just a clarification also on the CDMO side. If you look at sequentially, CDMO revenue would be up, is down by 13%, YOY up by 1%. Now, in the last two calls, we have been indicating supplies to late-stage development as well as commercials. So despite that, we are seeing a flattening out of revenue. So is there any callout you would like to make on that side? The ideal is commercials are playing out, then the ramp-up should be slightly higher before we start flattening out and the new molecule pipeline starts replacing or compensating for that. Yeah. Even while the late-stage supplies and also commercial supplies are ongoing, even in such situations, some of these supplies are once or twice per year in some cases. So there's not necessarily a supply going out every month. It comes down to their internal manufacturing capacity and demand requirements. So even in the case of it going commercial, we'll continue to expect lumpiness in some of the programs. I won't say that's the case for all, but some of the programs, you will continue to see that lumpiness on a quarter-to-quarter basis. On the annual basis, you have to look at on the annual basis, number one. And number two, on the annual basis, we are still committing to our earlier projection for the CDMO for the full year. That's correct. Yeah. Yeah. And sir, I was more keen on 27 because some new molecule supply has to start for us to compensate for this lumpiness, correct? Else we will see a kind of a flattening out or maybe 5%-10% kind of a growth in CDMO business. So if you can just talk a bit about that, how to look at 27 in CDMO revenue growth? While we are not giving any concrete numbers for 2027, we still expect a healthy growth over whatever we expect to report in 2026. So if you look at FY 2026, in the nine months, our growth is close to 50%. And we expect Q4, as I mentioned just now with another question, about Q4 FY 2027, we indicated that our Q4 FY 2026 will be better than Q4 FY 2026. So we have visibility now how FY 2027 looks like, but we are not giving any quantitative guidance. It's qualitative. It's more about qualitative. It's more about, are there any large molecules coming up for supplies for you in 27 based on the pipeline that you have created over the last two, three years? Is that the way to think that will drive the growth? The majority of FI27 revenues in our CDMO division will be commercial supplies. I think that much I can make a statement. Yeah. Majority commercial supplies. Okay. And sir, one last this, because this is more with the gross margin improvement that we have seen. Has currency played any role in your gross margin improvement? Because sequentially, we would have benefited reasonably on the USD-INR movement and USD-EUR movement also for that matter. Significant. Answer is yes, but not very significant. Could it contribute 20, 30 basis points or even 40, 50 basis points of gross margin improvement sequentially given the adverse? This is in context of adverse mix in the broader segment. CDMO share is down, APS share is significantly up. That's why I was asking. We will definitely get a benefit because we are a net exporter. But I'm saying that it is not a very significant impact or positive impact. Okay. Thank you and all the best. Thank you. The next question is from the line of Jeevan from Sahasrar Capital. Please go ahead. It's very heartening to hear the guidance of 60% gross margin going forward. I think it's very, very positive. Coming to the CDMO side, sir, I just want to understand your FY 2027, so one is the animal health. So I don't think animal health has still scaled up in '25 much. So animal health, how do you see the scale-up in FY 2027? Agrochemical also, I don't think FY 2026 we have done much of a delivery there. So how do you see agrochemical growing in FY 2027? And apart from that, is there any large contract that we are talking or are in the pipeline with the big pharma? If you can speak on that. Yes. On the animal health, there's ongoing commercial supplies for a few compounds, continue to do validations and filings for our partners in other programs. So there is some meaningful revenue for this year as well, and we expect to continue that or, in fact, grow on that. In the crop science space, we've commercialized one particular supplies for our partner, and we expect that to continue shipments in the coming years as well. But we look forward to adding more partners in the crop science space, but meaningful revenues for the crop science probably will start maybe two years or one to two years down the road. Okay. And. Yeah. Yeah. Good. Yeah. On the second question on the large commercial contracts, I mean, unfortunately, I can't necessarily comment on that, but we continue to have good discussions with several partners in several phases of the programs. Yeah. So are you basically seeing any cases where the innovator or large pharma is looking to move late-stage molecules from other clients to us? The opportunities exist, but unfortunately, without divulging confidential information, I can't really fully comment on that. So yes. Okay. No problem. No problem. Thanks a lot. And next question is about ImmunoAct. So I think we have done recently tie-up with Cipla for South Africa region. So any comment on that? How do you see that market or how do you see that opportunity? That opportunity will be meaningful only a year from now because of the regulatory approval needed in South Africa. So clinical trials will start soon in South Africa, for ImmunoAct. So it will be FY 2028, you will see that. But there are some milestones ImmunoAct already received from Cipla. Okay. Great, sir. Great. Thanks a lot. Thank you. Thank you. The next question is from the line of Bharat Siriparupu from Quest for Value Capital. Please go ahead. Yeah. Congrats for boosted numbers. Dr. Chava, regarding this new greenfield CapEx of 500 acres in Achutapuram, may I know when can we expect this new greenfield CapEx start coming online? Can we expect first phase of it to come somewhere in FY 2028? We are expecting land allotment, and handover will happen in the Q4 this year, financial year. CapEx will start from maybe second quarter of FY 2027, and we expect qualification and validations only two years from now, not before. Okay. Good. And my second question is to Krishna Chaitanya Chava. So currently, if you see there is a significant wave of demand coming to India on small molecule side from Innovators. So basically, what I understand is that the Innovators are chasing for capacity. Yeah. So with this background, how is Laurus prepared to handle this surge of demand? Are the current capacities sufficient to satisfy the CDMO demand? And are we considering scenarios like freeing up generic capacities and allocating them to CDMO? I think one of the strategies that we've adopted is investing ahead of time. That was the case over the last couple of years where we continued to do significant amount of CapEx. That was in line with what we were expecting from capacity requirements and customer additions. Therefore, that has positioned us strongly to meet some of these new opportunities that are coming about. That's also in line with our current guidance on CapEx for this year and the next year. This is to create capacities for our partners and opportunities that we are seeing. Basically, we didn't lose any business because of not having capacity basically till now? That's a fair statement to make, yes. Okay. Yeah. Thank you. Thank you very much. And my last question is to Soumya Garu. So if on generic, so recently, 3 billion tablet capacity has come online in year two for KRKA. So may I know from when do we expect to generate revenue from this new capacity? We've already started using the additional capacity, and we will see a little bit of increase or jump from next calendar year, from next financial year, next quarter Q1. Okay. Yeah. Thank you. Thank you very much. Yeah. That's it from my side. Yeah. Thank you, Bharat. Thank you. The next question is from the line of Vivek Agarwal from Citigroup. Please go ahead. Yeah. Thanks for the opportunity. So first question is related to peptides. So you are making ongoing investments. So just want to understand how much or what kind of investments you are making here, let's say, over the next couple of years, and when you see the revenues starting from this particular segment. Thank you. I think we'll give more details at an appropriate time, Vivek, on this. But I can give you a glimpse. We are creating capacity for fully integrated programs, protected amino acids, unnatural amino acids, fragments, final peptides, and purification isolation. So the capacity being created is fully integrated. Yeah. We'll give you more details at an appropriate time. Yeah. So just try to understand more. So is it like that you already have some contracts or talks with some of the big pharma, or is it like you are creating the capacity first, and then, for example, you are expecting some kind of business from this facility? I think I can't give you more details on this. And no problem at all. And in CDMO, actually, just building on the comments that you made during the call. So in 4Q, you are expecting growth YOY. So just want to understand, is the growth expected to come from a supply of a new commercial molecule, or is it kind of a late-stage molecule? If you can provide some more color. Most of the revenue in Q4 is going to come from commercial supplies of molecules what we supplied earlier. Okay. Understood. And just last question on CDMO. So in calendar year 2026, right, so how many commercial molecules, the new commercial molecules you are going to supply? In the last 18 months, I can give you because we did add a review internally. We supplied three commercial NCs in the last 18 months. Okay. Just lastly on the generics, right? In CDMO, you commented about that Q2 growth, YOY growth in the fourth quarter. How to think the performance of generic business in 4Q? In this quarter, actually, there is a significant step up. I just want to understand what is the sustainability of the step up in 3Q, and how to look this particular segment in FY 2027? Thank you. In the generic space, lion's share of revenues are coming from ARVs, both APIs and formulations. That business is pretty stable. Actually, we are able to increase our market share in both API and formulations in that. Our North American formulation and European CMO sales are also going up. I think we believe those numbers what we did in Q3 are sustainable. Yeah. Understood, sir. Thank you. That's from my side. Thank you. The next question is from the line of Ramesh, a CA. Please go ahead. This is to Mr. Ravi Kumar. Just I want to understand why there was a, I mean, marginal growth in CDMO business quarter on quarter as compared to our generic business. You are telling for nine months, of course, I understand, but for this particular quarter, why growth was not visible? Can you just repeat your question? Why CDMO revenues are not growing? If your question is why CDMO revenues are not growing, it is as we indicated, you can't compare on a quarter-on-quarter for a CDMO revenue. You have to see on a year basis. So the year as for nine months, as Dr. Satya said, we already achieved a 50% growth. For a year also, we are expecting to have a higher growth, and then you don't compare on quarter-on-quarter. I hope your question is that. The margins are sustainable, sir, even for the next quarter? Yes. Thank you. Thank you. This is from me. Thank you. The next question is from the line of Manav Mehta from Vriddhi. Please go ahead. Hi, sir. Good evening. So my question is on the MOU where we are signing with LCS South Korea, where we've announced entry into OLED materials, OLED materials. So my question is, how does Laurus enter into this structure apart from pharmaceutical? So similar to our strategy across different areas, right? For example, human health, animal health, and crop science, OLED represents another potential opportunity where we could be a potential player in the OLED materials, which are, again, small molecules or chemically synthesized compounds, right? For that, that's an MOU that we had agreed upon with LCS. And we don't necessarily expect to see any meaningful revenues this year or the next, but that gives us an opportunity to potentially play in this very lucrative market. Understood, sir. Thank you. Thank you. The next question is from the line of Vishal Dhaga, an individual investor. Please go ahead. Hi. My question was similar to what was the previous person asked. Just to add on to the question, what will be the total time of the market in the OLED segment, maybe 2027, 2028? Yeah. It's still an emerging development given that the partner program that we're working on is also a developmental program. So I can't necessarily comment on the market size itself because that's an emerging space that's currently under development. Understood. Okay. Thank you. Thank you. The next question is from the line of Aseem, an individual investor. Please go ahead. Yeah. Hi. Thanks for the opportunity. Many congratulations for the fabulous results for quarter three. So one of my questions on the business is already answered. Thank you for that. I have one question on the financials for quarter four. If you look at the last year, quarter four, we have other income of around INR 40-50 crores, which has led to higher profitability. So my question is, what is a one-off, or we can expect a similar level of other income in this quarter as well? We are not expecting another income in the quarter four. Okay. So that was a one-off for last year? Yes. Okay. Thank you. Thank you. Thank you. The next question is from the line of Abhijit K, an individual investor. Please go ahead. Hello. Can you hear me? Yes. Yeah. I'd like to understand. I have two questions with regards to the one question with regards to the asset turnover. May I know what is the asset turnover currently? 0.91, actually. Okay. 0.91. And I look at the generic business and the FDF. Mr. Chava had mentioned that you have entered into some new products, and the volume growth was there significantly, right? How sustainable is this? Because we've seen that the APA and the FDF sector has been fluctuating over the last 24 months, actually 24-36 months, if you see. But now this has been a significant ramp-up in the FDF and APA, both sectors. Is this something that we can expect the company to continue to grow on? Because you also have new capacity just online, as I mentioned earlier also. The growth in generic API business could be very sustainable. When it comes to growth in our other FDF business, it will also eventually be sustainable despite up and down three quarters because our increased capacity for our CMO business in Europe with a European customer will yield revenues starting from this quarter and fully operational by next quarter. We expect those numbers are also sustainable in the long run. May not be in Q4 this year and Q1 next year, but eventually, we expect to do well there as well. Okay. And one last question with regards to the peptides sector that is happening. We understand that you are working with an American biotech company, and we want to understand the timelines of these projects. Is it 24 months, 36 months, or 48 months, or is it really, really unpredictable? We have seen some data that there are some trials going on in the U.S. without disclosing the company, of course. But if you can understand timelines because you've invested billions of dollars in your company, and you are looking at the future of the sector, which is obviously it is ADC and peptides, which is like a revolutionary thing in pharma. So we wanted to understand what is the timeline, if you have any visibility or anything like that. I think you have to bear with us for some more time. We will give you the details at an appropriate time. Yeah. But as you mentioned, we are investing a significant amount in peptides as well as also a significant amount in ADCs. Yeah. So in that part, can we conclude that you are trying to move from being an API or CDMO sector to a biotech company, a company that is like the longer-term vision for the organization? No. See, our investments in biotech, for example, cell therapy, gene therapy, ADCs are most emerging fields globally. And we wanted to invest ahead of the curve and wet our hands to capture opportunities. In the case of peptides and all, we are well established. We have investment. We have programs running right now. So the answer to your question is we are more focused on small volume CDMO than large volume CDMO right now, large volume CDMO. Yeah. Okay. All right. Thank you. Thank you. Thank you. The next question is from the line of Anjan Banerjee, an individual investor. Please go ahead. Hello. Am I audible? Yes. Yes, sir. I have a question for Dr. Chava, and thank you for the opportunity. Sir, I have a question on the CDMO space. Like we have been seeing many of the Indian pharma players, they have been expanding their capacity towards this CDMO segment. As per understanding, how big and long is this opportunity? Given that Laurus has invested so much in the last couple of years towards expanding the capability and capacity, what is the competitive advantage that Laurus Labs has as compared to its peers? That's one of my questions. I don't say we have advantage. We were well prepared to take the opportunity. I'll put it that way. So people look at us if there is a complex chemistry, if there is a scale involved, if it is a flow chemistry, if it is biocatalysis, if it is high-energy chemistry, and involves scale, and we are the perfect partners. So we have invested in these modalities and created capacities. Okay. So sir, as per you, whatever these competitors that you talked about, so is it a fair assumption that developing these capabilities is a very long-term process, and any pharma company just cannot hire scientists and just foray into these because they are very skillful operations? So is it fair that developing these and getting the customer approval is a very big thing because the capability matters a lot as compared to the capacity? So is it a fair assumption? Yeah. I think initially, we are creating capabilities and then investing in capacities. So what I mentioned, Laurus currently uses enzymes at the commercial scale. Laurus uses flow chemistry at commercial scale. So we are going in phase I. First, we create capabilities and then create capacities. And we believe projects will come. Sir, my second question is for the CDMO space only that you have constantly guided that we intend to reach that 50% of our share which will be driven from the CDMO segment overall. So is it the ceiling, or once we reach this 50%, it will look beyond the breaching rates? That 50% ceiling also. That's the second question. I think our first goal is to reach 50%. Yeah, for a long term. We are not going to be there in the medium term. It is a long-term goal for us to get there. Okay. Thank you very much and all the best. Thank you. Thank you. The next question is from the line of Kodandapani, an individual investor. Please go ahead. Good evening. Thank you very much for being here. Good result for this quarter. So I want to ask you, what is the exchange benefit for this quarter because of the huge reduction in the dollar? Yes, but not very significant. Okay. Okay. Thank you. Most of the things already clarified. Very thanks. Thank you. Yeah. Okay. Thank you. Thank you. Thank you. The next question is from the line of Nitin Agarwal from DAM Capital. Please go ahead. Hi there. Thanks for taking my question. Sir, on the ARVs, you've been earlier mentioning that the business will sort of stabilize around INR 2,400-INR 2,500 crore. We seem to be running significantly ahead of the run rate in the current year. So has something changed in the ARV space per se which has enabled us to improve our scale in this business? And is it sustainable? See, earlier, we guided INR 2,500 ± 200 crore. But you're right. Current run rate is a little beyond that. The main contributor for that is we have expanded our API capacities to meet our customer demand. That's driving our positive growth there. Now, if I have to restate that, currently, we are at INR 2,600 ± 200 crore. I'll put it that way. But fundamentally, it hasn't changed much. And sir, given there were some changes in the market landscape, has the profitability of the business also improved versus the dip it had a couple of years back? Is it a much better business profitability-wise than it was maybe a couple of years back? It's profitable if we sweat assets more. That's what we're doing right now. Yeah. But you don't see any major change in the competitive intensity in the business in that quarter? No. We're not seeing any. But Nitin, actually, what happened, actually, we suffered for a few quarters because of the steep price reduction, but that we could be able to recover those things because of some process improvements, raw material prices, and productivity improvements. Yes, we have been indicating for the last six quarters that we have been working on ARVs that have been resulted in this quarter. Actually, it's sustainable. Yeah. API sales. Sir, secondly, on the non-ARV formulation business, what are the growth drivers for this business when you look at next 12-18 months? We expect to sustain those because of additional capacities coming up for our CMO partner in Europe and also volume gain in the U.S. and also some new launches in North America, both the U.S. and Canada. Okay. And sir, this will, because this quarter was probably the first decent quarter of ramp-up which happened. We had a pretty meaningful ramp-up, actually, this quarter. So is this like a run rate from year on, or there will be lumpiness in this business as we go along? I think we expect a little lumpiness, but it is not significant. Yeah. Sir, lastly, on the CDMO business versus the kind of conversations we were having with investors or rather with our partners a couple of years back to the kind of conversations we're beginning to have now, what has been the change? I mean, if you can qualitatively indicate the change in the quality of discussions we are having, scale and scope of discussions we are having with various partners on CDMO? I'm sorry. What answer? Any change in? That's, I mean, it's a long answer. But okay, to just summarize it, I think the tone of the conversations continues to remain the same in terms of what kind of capacities, capabilities, and credentials that the company has. I think that's what primarily attracts customers. With that being said, I think the global landscape has been a tailwind for potential conversations with customers. But the fundamentals need to be sound, and that will only drive the business, is our understanding at least. Okay. Thank you so much. Thank you. The next question is from the line of Abhijit K, an individual investor. Please go ahead. Abhijit, please go ahead with your question. Your line is unmuted. Yeah. I had a clarification with regards to the CDMO business. You mentioned animal health and crop sciences. Animal health will continue in FY 2027, and crop sciences, one product has been commercialized, and meaningful supply will happen in one to two years. I remember in the previous phone calls, you had mentioned about human health CDMO contract also. Is that still on track, or is there approval spending and etc.? In the human health space, there are several different programs that we currently work in with several partners. As Dr. K mentioned, there are several commercial supplies ongoing in the human health space. Okay. But percentage-wise, can you give a breakup? Is it possible to say what are you looking more at? Is it crop science, is it animal health, or is the future going to be human health? Because that's where I think a lot of companies are talking about it. So just a picture, if not to be too specific, but just a rough. Our largest share of CDMO is in the human health space by far, and that will continue to be the case. After that, we have a sizable portion coming in from animal health. And the third one, which is again currently very small, is in the crop science space. And this ranking of human health, animal health, and crop science will be similar if I project a couple of years down the road as well. Okay. The crop science is the one? Is it a patented product or no? I'm asking this question because next year and in the next two years, a lot of products are going off-patent. I just wanted to understand if it will affect you or not. Yeah. The commercial one is technically a patented product. Some of the other opportunities that we're working on are also on the patented ones that we're looking at. Sure. Thank you. Thank you. Thank you. The next question is from the line of Dheeraj Kumar Reddy from EquaSquare. Please go ahead. Thanks. Thanks for giving me this opportunity. I just have a couple of questions. The first question being, many CDMO players are talking about peptides as an opportunity today. I mean, even Neuland or First Pharma etc., right? They say that this is a $10 billion opportunity. Dr. Chava, I just wanted to understand what out of this $10 billion opportunity, how much will probably come to India, or is it only Indian opportunity? And relevant players will get what kind of market share out of this overall? I mean, you can just give me in a three- to five-year time frame maybe. Yeah. It's a very difficult question to answer. See, we don't have visibility on who is investing, what capacity, what products we have. They have. But whoever gets the GLP opportunity, people are investing in amino acids, protective amino acids, fragments, and some of them investing in small volume, some of them investing large volume. Opportunity is going to be meaningful for a good number of players. And I will not be in a position to comment any further on this. Got it. And my second question, Dr. Chava, is basically, so if you're saying that ARV will be more or less in the range of INR 2,500 crore-INR 3,000 crore, what is the expected growth in the API segment going forward, API and the formulations? How will they grow in the next two to three years? We grow in the next year, but significant growth will come in FY 2028 because we're adding capacities where we are getting some generic APIs and formulations. So growth will be significant FY 2028, but there will be some growth in FY 2027 as well. The generic APIs will have their TS space. Understood. Okay. Got it. Got it. Thanks, Dr. Chava. I think that's all from me. Thank you. Ladies and gentlemen, this will be the last question for today, which is from the line of Mr. Bansal from NBG Investments. Please go ahead. Yeah. You said while answering one of the questions from the participant that your asset turnover is 0.9. So what is the maximum achievable capacity sorry, fixed asset turnover ratio? If you look at one of our slides in the investor presentation, our five-year average asset turn was 1.1. Our first target is to reach 1.1. Maybe 0.9 to 1.1, we will reach. But our peak asset turn was 1.4. We are not anticipating 1.4 at this moment, but we are targeting 1.1 over a period of time. Okay. That means you are almost at the full capacity utilization. But 0.9-1.1, actually, there is a we can see it. Correct. Correct. Okay. Okay. Thank you very much. Okay. Thank you. Thank you. Ladies and gentlemen, as this was the last question for today, I now hand the conference over to management for closing comments. Thank you, everyone, for asking very insightful questions. Thank you. Thank you. Thank you. On behalf of DAM Capital Advisors Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.

Speaker 9: Ladies and gentlemen, good day and welcome to the Laurus Labs 3Q FY 2026 Earnings Conference Call hosted by DAM Capital Advisors Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on the touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Nitin Agarwal from DAM Capital Advisors Limited. Thank you, and over to you, Mr. Nitin. Ladies and gentlemen, good day and welcome to the Laurus Labs 3Q FY 2026 Earnings Conference Call hosted by DAM Capital Advisors Limited. ladies and gentlemen good day and welcome to the laurus labs 3q fy 2026 earnings conference call hosted by dam capital advisors limited As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. as a reminder all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes Should you need assistance during the conference call, please signal an operator by pressing star then zero on the touchstone phone. should you need assistance during the conference call please signal an operator by pressing star then zero on the touchstone phone Please note that this conference is being recorded. please note that this conference is being recorded I now hand the conference over to Mr. Nitin Agarwal from DAM Capital Advisors Limited. i now hand the conference over to mr nitin agarwal from dam capital advisors limited Thank you, and over to you, Mr. Nitin. thank you and over to you mr nitin

Speaker 8: Thank you so much. Good afternoon, everyone, and a very warm welcome to Laurus Labs Q3 FY 2026 earnings call hosted by DAM Capital Advisors Limited. On the call today, we have representing Laurus Labs management, Dr. Satyanarayana Chava, Founder and CEO, Mr. V. V. Ravi Kumar, Executive Director, Mr. Krishna Chaitanya Chava, ED, Head CDMO, Mrs. Soumya Chava, ED, Generics and Commercial, and Mr. Vivek Kumar, AVP Investor Relations. Thank you so much. thank you so much Good afternoon, everyone, and a very warm welcome to Laurus Labs Q3 FY 2026 earnings call hosted by DAM Capital Advisors Limited. good afternoon everyone and a very warm welcome to laurus labs q3 fy 2026 earnings call hosted by dam capital advisors limited On the call today, we have representing Laurus Labs management, Dr. Satyanarayana Chava, Founder and CEO, Mr. V. on the call today we have representing laurus labs management dr satyanarayana chava founder and ceo mr v V. v Ravi Kumar, Executive Director, Mr. Krishna Chaitanya Chava, ED, Head CDMO, Mrs. Soumya Chava, ED, Generics and Commercial, and Mr. Vivek Kumar, AVP Investor Relations. ravi kumar executive director mr krishna chaitanya chava ed head cdmo mrs soumya chava ed generics and commercial and mr vivek kumar avp investor relations Before we proceed, I would like to remind you that some of the statements made during the call today could be forward-looking in nature, and a safe harbor statement to this effect has been included in the press release that has been shared on the company's website. I hand over the call now to Dr. Chava to make the opening comments, and then we'll open the floor for questions. Please go ahead, sir. Before we proceed, I would like to remind you that some of the statements made during the call today could be forward-looking in nature, and a safe harbor statement to this effect has been included in the press release that has been shared on the company's website. before we proceed i would like to remind you that some of the statements made during the call today could be forward-looking in nature and a safe harbor statement to this effect has been included in the press release that has been shared on the company's website I hand over the call now to Dr. Chava to make the opening comments, and then we'll open the floor for questions. i hand over the call now to dr chava to make the opening comments and then we'll open the floor for questions Please go ahead, sir. please go ahead sir

Speaker 12: Thank you, Nitin. Good afternoon, everyone. We continue to execute our strategy to advancement of important clinical and commercial programs with global partners, successful ramp-up of new launches, and strengthening our leadership in the ARV segment. Our large-scale development and manufacturing capabilities across small molecule as well as large molecule offering continue to gain traction with multiple partners. We are seeing a healthy level of interest across technologies and scale from our long-term existing partnerships. We are confident that we are investing in interesting technology platforms, many of those already underway. Successful execution on these projects will continue to transform our business portfolio and drive future growth. Some of the notable progress I wish to highlight: we made significant investments in CapEx so far in peptide development and manufacturing infrastructure to meet our current and future capacity requirements. Thank you, Nitin. thank you nitin Good afternoon, everyone. good afternoon everyone We continue to execute our strategy to advancement of important clinical and commercial programs with global partners, successful ramp-up of new launches, and strengthening our leadership in the ARV segment. we continue to execute our strategy to advancement of important clinical and commercial programs with global partners successful ramp-up of new launches and strengthening our leadership in the arv segment Our large-scale development and manufacturing capabilities across small molecule as well as large molecule offering continue to gain traction with multiple partners. our large-scale development and manufacturing capabilities across small molecule as well as large molecule offering continue to gain traction with multiple partners We are seeing a healthy level of interest across technologies and scale from our long-term existing partnerships. we are seeing a healthy level of interest across technologies and scale from our long-term existing partnerships We are confident that we are investing in interesting technology platforms, many of those already underway. we are confident that we are investing in interesting technology platforms many of those already underway Successful execution on these projects will continue to transform our business portfolio and drive future growth. successful execution on these projects will continue to transform our business portfolio and drive future growth Some of the notable progress I wish to highlight: we made significant investments in CapEx so far in peptide development and manufacturing infrastructure to meet our current and future capacity requirements. some of the notable progress i wish to highlight we made significant investments in capex so far in peptide development and manufacturing infrastructure to meet our current and future capacity requirements In addition, we operationalized our antibody-drug conjugate and gene therapy process development labs in Hyderabad this quarter, and the construction of GMP manufacturing facility is well on track. Last month, we also announced an increase in giant investments in KRKA, which is in line with our plan to support ongoing FDA facility construction in Hyderabad. Phase I is expected to be completed by mid-2027. Moving on to financial results, we delivered another quarter of strong operational and financial performance. Revenues for the third quarter stood at INR 1,778 crores. Gross margins have expanded further from the previous quarters and maintained around 60%. EBITDA margins expanded to a little over 27%. To achieve these numbers through strong performance across our generic business and also clinical and commercial supplies of CDMO programs to our partners. In addition, we operationalized our antibody-drug conjugate and gene therapy process development labs in Hyderabad this quarter, and the construction of GMP manufacturing facility is well on track. in addition we operationalized our antibody-drug conjugate and gene therapy process development labs in hyderabad this quarter and the construction of gmp manufacturing facility is well on track Last month, we also announced an increase in giant investments in KRKA, which is in line with our plan to support ongoing FDA facility construction in Hyderabad. last month we also announced an increase in giant investments in krka which is in line with our plan to support ongoing fda facility construction in hyderabad Phase I is expected to be completed by mid-2027. phase i is expected to be completed by mid-2027 Moving on to financial results, we delivered another quarter of strong operational and financial performance. moving on to financial results we delivered another quarter of strong operational and financial performance Revenues for the third quarter stood at INR 1,778 crores. revenues for the third quarter stood at inr 1,778 crores Gross margins have expanded further from the previous quarters and maintained around 60%. gross margins have expanded further from the previous quarters and maintained around 60% EBITDA margins expanded to a little over 27%. ebitda margins expanded to a little over 27% To achieve these numbers through strong performance across our generic business and also clinical and commercial supplies of CDMO programs to our partners. to achieve these numbers through strong performance across our generic business and also clinical and commercial supplies of cdmo programs to our partners Our product mix within business division and operating leverage have continued to do well in supporting our healthy margins overall. As we look forward, we remain well on track to deliver healthy operational growth for the entire financial year 2026. Now, I would like to request Mr. Nitin to share key updates on our CDMO business. Our product mix within business division and operating leverage have continued to do well in supporting our healthy margins overall. our product mix within business division and operating leverage have continued to do well in supporting our healthy margins overall As we look forward, we remain well on track to deliver healthy operational growth for the entire financial year 2026. as we look forward we remain well on track to deliver healthy operational growth for the entire financial year 2026 Now, I would like to request Mr. Nitin to share key updates on our CDMO business. now i would like to request mr nitin to share key updates on our cdmo business

Speaker 5: Thank you. Yeah. On the CDMO side, we continue to see strong interest in our integrated service offerings across various complex technology platforms. Our cumulative nine-month performance has been very healthy, clocking more than 50% growth. This has been supported by strong recurring business from our existing long-term customer relationships across various different scales. Now, in the small molecule space, our Q3 sales have been at INR 408 crore. I would say this performance is in line with our expectation due to phasing of deliveries in the coming quarters involving very long and complex synthetic processes. Pipeline momentum has remained very healthy with a well-balanced mix of big pharma clientele and also mid and small-sized biotechs. The majority of the pipeline programs under execution utilize several advanced technology platforms. Thank you. thank you Yeah. yeah On the CDMO side, we continue to see strong interest in our integrated service offerings across various complex technology platforms. on the cdmo side we continue to see strong interest in our integrated service offerings across various complex technology platforms Our cumulative nine-month performance has been very healthy, clocking more than 50% growth. our cumulative nine-month performance has been very healthy clocking more than 50% growth This has been supported by strong recurring business from our existing long-term customer relationships across various different scales. this has been supported by strong recurring business from our existing long-term customer relationships across various different scales Now, in the small molecule space, our Q3 sales have been at INR 408 crore. now in the small molecule space our q3 sales have been at inr 408 crore I would say this performance is in line with our expectation due to phasing of deliveries in the coming quarters involving very long and complex synthetic processes. i would say this performance is in line with our expectation due to phasing of deliveries in the coming quarters involving very long and complex synthetic processes Pipeline momentum has remained very healthy with a well-balanced mix of big pharma clientele and also mid and small-sized biotechs. pipeline momentum has remained very healthy with a well-balanced mix of big pharma clientele and also mid and small-sized biotechs The majority of the pipeline programs under execution utilize several advanced technology platforms. the majority of the pipeline programs under execution utilize several advanced technology platforms In line with that, we continue investment for large-scale capacity expansion in our WSAC sites and expanding our capabilities, including peptides, flow, high-energy chemistries, purifications, etc. Now, on the bio division side of things, Q3 sales have been reported at INR 43 crore. The performance has been a bit muted, but we are seeing better and longer visibility on demand projections and executing longer campaigns on the CDMO side. Additionally, our AOF business is clocking healthy operational progress with continuing customer interest for dedicated lines. Construction work for the commercial-scale fermentation facility at WSAC is progressing in line with the plan, and we expect a phase I capacity of a little over 400 kiloliters to be operational towards the end of 2026. Thank you, Krishna. In line with that, we continue investment for large-scale capacity expansion in our WSAC sites and expanding our capabilities, including peptides, flow, high-energy chemistries, purifications, etc. Now, on the bio division side of things, Q3 sales have been reported at INR 43 crore. in line with that we continue investment for large-scale capacity expansion in our wsac sites and expanding our capabilities including peptides flow high-energy chemistries purifications etc now on the bio division side of things q3 sales have been reported at inr 43 crore The performance has been a bit muted, but we are seeing better and longer visibility on demand projections and executing longer campaigns on the CDMO side. the performance has been a bit muted but we are seeing better and longer visibility on demand projections and executing longer campaigns on the cdmo side Additionally, our AOF business is clocking healthy operational progress with continuing customer interest for dedicated lines. additionally our aof business is clocking healthy operational progress with continuing customer interest for dedicated lines Construction work for the commercial-scale fermentation facility at WSAC is progressing in line with the plan, and we expect a phase I capacity of a little over 400 kiloliters to be operational towards the end of 2026. construction work for the commercial-scale fermentation facility at wsac is progressing in line with the plan and we expect a phase i capacity of a little over 400 kiloliters to be operational towards the end of 2026 Thank you, Krishna. thank you krishna

Speaker 12: I would request Mrs. Soumya Chava to share key updates on our generic business. I would request Mrs. Soumya Chava to share key updates on our generic business. i would request mrs soumya chava to share key updates on our generic business

Speaker 13: Thank you. The revenues from the generic division have continued to perform well, reporting growth of 37% to INR 1,327 crores for quarter three. For the nine-month period, we achieved sales of INR 3,510 crores, reflecting growth of 26%. The growth has been supported by higher ARV volumes and, more specifically, by strong offtake in recently launched products in the developed markets. We continue to see stability from the established product portfolio and expect the benefits to continue, at least in the near term. The broad API market portfolio and production capacity in the ARV business continue to be fully optimized, ensuring that we are well-positioned to support additional orders as and when they arrive. This positions us well to meet customer requirements. The overall solid facility expansion is progressing well. Thank you. thank you The revenues from the generic division have continued to perform well, reporting growth of 37% to INR 1,327 crores for quarter three. the revenues from the generic division have continued to perform well reporting growth of 37% to inr 1,327 crores for quarter three For the nine-month period, we achieved sales of INR 3,510 crores, reflecting growth of 26%. for the nine-month period we achieved sales of inr 3,510 crores reflecting growth of 26% The growth has been supported by higher ARV volumes and, more specifically, by strong offtake in recently launched products in the developed markets. the growth has been supported by higher arv volumes and more specifically by strong offtake in recently launched products in the developed markets We continue to see stability from the established product portfolio and expect the benefits to continue, at least in the near term. we continue to see stability from the established product portfolio and expect the benefits to continue at least in the near term The broad API market portfolio and production capacity in the ARV business continue to be fully optimized, ensuring that we are well-positioned to support additional orders as and when they arrive. the broad api market portfolio and production capacity in the arv business continue to be fully optimized ensuring that we are well-positioned to support additional orders as and when they arrive This positions us well to meet customer requirements. this positions us well to meet customer requirements The overall solid facility expansion is progressing well. the overall solid facility expansion is progressing well A significant part of the planned capacity became operational during the quarter and is currently undergoing ramp-up activities in line with the plan. Cumulatively, 92 DMFs have been filed to date. In developed markets, four formulation doses have been filed and five approvals received during the nine-month period. Overall, 91 products have been filed cumulatively to date. Thank you. A significant part of the planned capacity became operational during the quarter and is currently undergoing ramp-up activities in line with the plan. a significant part of the planned capacity became operational during the quarter and is currently undergoing ramp-up activities in line with the plan Cumulatively, 92 DMFs have been filed to date. cumulatively 92 dmfs have been filed to date In developed markets, four formulation doses have been filed and five approvals received during the nine-month period. in developed markets four formulation doses have been filed and five approvals received during the nine-month period Overall, 91 products have been filed cumulatively to date. overall 91 products have been filed cumulatively to date Thank you. thank you

Speaker 12: Thanks, Krishna and Soumya for the overview of generics and CDMO business. On the R&D front, overall R&D spending was at 4.1% of our sales for the nine months. The peptide research increased by 8% year-on-year, including our spend on the energy benefit space. This R&D spend is in line with our full-year target, and we continue to invest in portfolio focusing on product complexity, scale, and sustainable and new technology platforms. Thanks, Krishna and Soumya for the overview of generics and CDMO business. thanks krishna and soumya for the overview of generics and cdmo business On the R&D front, overall R&D spending was at 4.1% of our sales for the nine months. on the r&d front overall r&d spending was at 4.1% of our sales for the nine months The peptide research increased by 8% year-on-year, including our spend on the energy benefit space. the peptide research increased by 8% year-on-year including our spend on the energy benefit space This R&D spend is in line with our full-year target, and we continue to invest in portfolio focusing on product complexity, scale, and sustainable and new technology platforms. this r&d spend is in line with our full-year target and we continue to invest in portfolio focusing on product complexity scale and sustainable and new technology platforms Let me share a brief one on the quality side. In the nine months, the company underwent close to 110 quality audits by multiple drug regulatory agencies and several customers. The company has successfully passed audit inspections without any critical findings. On the ESG front, one of the leading agencies, S&P Global, has published its 2024 ESG score, in which Laurus reported an impressive 10 percentage point increase in the score, achieving 81 out of 100 points. Let me share a brief one on the quality side. let me share a brief one on the quality side In the nine months, the company underwent close to 110 quality audits by multiple drug regulatory agencies and several customers. in the nine months the company underwent close to 110 quality audits by multiple drug regulatory agencies and several customers The company has successfully passed audit inspections without any critical findings. the company has successfully passed audit inspections without any critical findings On the ESG front, one of the leading agencies, S&P Global, has published its 2024 ESG score, in which Laurus reported an impressive 10 percentage point increase in the score, achieving 81 out of 100 points. on the esg front one of the leading agencies s&p global has published its 2024 esg score in which laurus reported an impressive 10 percentage point increase in the score achieving 81 out of 100 points This reflects our continued commitment to sustainable development and exceptional performance in ESG practices as we move along. Now, I request Mr. Ravi Kumar to share overall financial highlights. This reflects our continued commitment to sustainable development and exceptional performance in ESG practices as we move along. this reflects our continued commitment to sustainable development and exceptional performance in esg practices as we move along Now, I request Mr. Ravi Kumar to share overall financial highlights. now i request mr ravi kumar to share overall financial highlights

Speaker 15: Yeah, thank you, Dr. Satya, and very warm welcome to everyone for this quarter three and nine-month FY 2026 earnings call. Total income from operations for the nine months came at around INR 5,001 crores. We just crossed INR 5,000 crores in nine months' time, registered a growth of 30%. We have continued to deliver strong growth mainly due to sustained ARV business momentum, strong CDMO, and growth in other generic business. For the quarter three, total income from operations was at INR 1,778 crores, with a 26% growth. Yeah, thank you, Dr. Satya, and very warm welcome to everyone for this quarter three and nine-month FY 2026 earnings call. yeah thank you dr satya and very warm welcome to everyone for this quarter three and nine-month fy 2026 earnings call Total income from operations for the nine months came at around INR 5,001 crores. total income from operations for the nine months came at around inr 5,001 crores We just crossed INR 5,000 crores in nine months' time, registered a growth of 30%. we just crossed inr 5,000 crores in nine months' time registered a growth of 30% We have continued to deliver strong growth mainly due to sustained ARV business momentum, strong CDMO, and growth in other generic business. we have continued to deliver strong growth mainly due to sustained arv business momentum strong cdmo and growth in other generic business For the quarter three, total income from operations was at INR 1,778 crores, with a 26% growth. for the quarter three total income from operations was at inr 1,778 crores with a 26% growth Gross margin maintained healthy way for nine months at 60.1%, and for quarter three, it is at 60.9%, mainly due to better product and division mix and continued process improvement efforts. EBITDA for nine months stands at INR 1,303 crores, with a margin of 26.1%. It is well within our early-year guided range. Gross margin maintained healthy way for nine months at 60.1%, and for quarter three, it is at 60.9%, mainly due to better product and division mix and continued process improvement efforts. gross margin maintained healthy way for nine months at 60.1% and for quarter three it is at 60.9% mainly due to better product and division mix and continued process improvement efforts EBITDA for nine months stands at INR 1,303 crores, with a margin of 26.1%. ebitda for nine months stands at inr 1,303 crores with a margin of 26.1% It is well within our early-year guided range. it is well within our early-year guided range For quarter three, EBITDA reported at INR 485 crores, with a margin of 27%, due to strong operational leverage. Profit after tax at nine months: INR 610 crores. It's a growth of 388%, and for quarter three, INR 252 crores. ROCE has improved to 18.5%. If you look at the last three quarters, it is progressively improving. On the CapEx front, we invested about INR 246 crores for the quarter, and cumulatively for nine months, it is INR 735 crores. For quarter three, EBITDA reported at INR 485 crores, with a margin of 27%, due to strong operational leverage. for quarter three ebitda reported at inr 485 crores with a margin of 27% due to strong operational leverage Profit after tax at nine months: INR 610 crores. profit after tax at nine months inr 610 crores It's a growth of 388%, and for quarter three, INR 252 crores. it's a growth of 388% and for quarter three, inr 252 crores ROCE has improved to 18.5%. roce has improved to 18.5% If you look at the last three quarters, it is progressively improving. if you look at the last three quarters it is progressively improving On the CapEx front, we invested about INR 246 crores for the quarter, and cumulatively for nine months, it is INR 735 crores. on the capex front we invested about inr 246 crores for the quarter and cumulatively for nine months it is inr 735 crores Our net debt stood at INR 2,092 crores, which is a similar range of quarter-ended September, and debt to EBITDA has further decreased to around 1.2. On the capital allocation front, our strategy remains unchanged, and we will continue to prioritize investments into high-value business segments to drive near and long-term growth and return for our shareholder over a period of time. Our net debt stood at INR 2,092 crores, which is a similar range of quarter-ended September, and debt to EBITDA has further decreased to around 1.2. our net debt stood at inr 2,092 crores which is a similar range of quarter-ended september and debt to ebitda has further decreased to around 1.2 On the capital allocation front, our strategy remains unchanged, and we will continue to prioritize investments into high-value business segments to drive near and long-term growth and return for our shareholder over a period of time. on the capital allocation front our strategy remains unchanged and we will continue to prioritize investments into high-value business segments to drive near and long-term growth and return for our shareholder over a period of time To conclude, as we will finish the year, we are confident in delivering growth and ongoing focus on execution. We remain well-positioned to drive long-term growth. You can refer to our IR presentation for more details. With this, I would request the moderator to open the lines for a few minutes. Thank you. To conclude, as we will finish the year, we are confident in delivering growth and ongoing focus on execution. to conclude as we will finish the year we are confident in delivering growth and ongoing focus on execution We remain well-positioned to drive long-term growth. we remain well-positioned to drive long-term growth You can refer to our IR presentation for more details. you can refer to our ir presentation for more details With this, I would request the moderator to open the lines for a few minutes. with this i would request the moderator to open the lines for a few minutes Thank you. thank you

Speaker 9: Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Tushar Manudhane from Motilal Oswal Financial Services. Please go ahead. Thank you very much. thank you very much We will now begin the question and answer session. we will now begin the question and answer session Anyone who wishes to ask a question may press star and one on the touch-tone telephone. anyone who wishes to ask a question may press star and one on the touch-tone telephone If you wish to remove yourself from the question queue, you may press star and two. if you wish to remove yourself from the question queue you may press star and two Participants are requested to use handsets while asking a question. participants are requested to use handsets 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 comes from the line of Tushar Manudhane from Motilal Oswal Financial Services. the first question comes from the line of tushar manudhane from motilal oswal financial services Please go ahead. please go ahead

Speaker 14: Thanks for the opportunity and congrats on a good set of numbers. Just first, to start with, a question in terms of, could you break down ARV sales into formulations and API. Thanks for the opportunity and congrats on a good set of numbers. thanks for the opportunity and congrats on a good set of numbers Just first, to start with, a question in terms of, could you break down ARV sales into formulations and API. just first to start with a question in terms of could you break down arv sales into formulations and api

Speaker 12: Hello. Yeah, I'm just answering. In the nine months, API is INR 86 crores. The formulation is INR 865 crores ARV. In the API, it is INR 1,259 crores. Hello. hello Yeah, I'm just answering. yeah i'm just answering In the nine months, API is INR 86 crores. in the nine months api is inr 86 crores The formulation is INR 865 crores ARV. the formulation is inr 865 crores arv In the API, it is INR 1,259 crores. in the api it is inr 1,259 crores

Speaker 14: Sorry, how much? How much is the API? Sorry, how much? sorry how much How much is the API? how much is the api

Speaker 15: Tushar, these numbers can be. It is there in the IR, or I, Vivek, can give it to you, Tushar. You can ask any qualitative question. Tushar, these numbers can be. tushar these numbers can be It is there in the IR, or I, Vivek, can give it to you, Tushar. it is there in the ir or i vivek can give it to you tushar You can ask any qualitative question. you can ask any qualitative question

Speaker 12: The total ARV revenues were INR 744 crores for the quarter three. The total ARV revenues were INR 744 crores for the quarter three. the total arv revenues were inr 744 crores for the quarter three

Speaker 14: Got it. So secondly, on the CapEx side, this nine month CapEx is largely more than what we would have done in FY 2025. And then we have certain contracts made on the peptide side or now in ADC. So firstly, how much one can think about investment into peptides as an asset over, let's say, the next 12-24 months? And ADCs as well, if you could. And then thirdly, on the overall CapEx for 2027. Got it. got it So secondly, on the CapEx side, this nine month CapEx is largely more than what we would have done in FY 2025. so secondly on the capex side this nine month capex is largely more than what we would have done in fy 2025 And then we have certain contracts made on the peptide side or now in ADC. and then we have certain contracts made on the peptide side or now in adc So firstly, how much one can think about investment into peptides as an asset over, let's say, the next 12-24 months? so firstly how much one can think about investment into peptides as an asset over let's say the next 12-24 months And ADCs as well, if you could. and adcs as well if you could And then thirdly, on the overall CapEx for 2027. and then thirdly on the overall capex for 2027

Speaker 12: The ADC is still at the nascent stage right now. We have allocated $25 million to the GMP facility, which is under construction right now. We don't expect any meaningful revenues coming from ADCs in the next two years. When it comes to CDMO investment in peptide commercial manufacturing facilities, we expect qualification during this calendar year. We will give you more details as and when we are in a position to give feedback to you. The ADC is still at the nascent stage right now. the adc is still at the nascent stage right now We have allocated $25 million to the GMP facility, which is under construction right now. we have allocated $25 million to the gmp facility which is under construction right now We don't expect any meaningful revenues coming from ADCs in the next two years. we don't expect any meaningful revenues coming from adcs in the next two years When it comes to CDMO investment in peptide commercial manufacturing facilities, we expect qualification during this calendar year. when it comes to cdmo investment in peptide commercial manufacturing facilities we expect qualification during this calendar year We will give you more details as and when we are in a position to give feedback to you. we will give you more details as and when we are in a position to give feedback to you

Speaker 14: For overall CapEx? For overall CapEx? for overall capex

Speaker 12: Overall CapEx this year will be about INR 1,000 crores in FY 2026. FY 2026, based on the current estimate, we do feel it will be over INR 1,000 crores next year also. Overall CapEx this year will be about INR 1,000 crores in FY 2026. overall capex this year will be about inr 1,000 crores in fy 2026 FY 2026, based on the current estimate, we do feel it will be over INR 1,000 crores next year also. fy 2026 based on the current estimate we do feel it will be over inr 1,000 crores next year also

Speaker 14: This will be largely done with keeping net debt at similar number? This will be largely done with keeping net debt at similar number? this will be largely done with keeping net debt at similar number

Speaker 15: Maybe debt may be increased slightly if it's needed, but your debt by EBITDA will be in a better way. Maybe debt may be increased slightly if it's needed, but your debt by EBITDA will be in a better way. maybe debt may be increased slightly if it's needed but your debt by ebitda will be in a better way

Speaker 14: Got it. And just one last from my side, if you could at least just share in terms of pecking order the gross margin for different segments like API, synthesis, FBF? Got it. got it And just one last from my side, if you could at least just share in terms of pecking order the gross margin for different segments like API, synthesis, FBF? and just one last from my side if you could at least just share in terms of pecking order the gross margin for different segments like api synthesis fbf

Speaker 12: I'm not giving that segment-wise gross margin details, but it is everybody's guess. Yeah. I'm not giving that segment-wise gross margin details, but it is everybody's guess. i'm not giving that segment-wise gross margin details but it is everybody's guess Yeah. yeah

Speaker 14: Qualitatively, while not a specific number, but directionally if you have to think about, is FBF, synthesis at a similar gross margin, API at a lower gross margin? Is that the way to think about? Qualitatively, while not a specific number, but directionally if you have to think about, is FBF, synthesis at a similar gross margin, API at a lower gross margin? qualitatively while not a specific number but directionally if you have to think about is fbf synthesis at a similar gross margin api at a lower gross margin Is that the way to think about? is that the way to think about

Speaker 15: Tushar, the order remains same. CDMO, formulation, API. This is an order. Tushar, the order remains same. tushar the order remains same CDMO, formulation, API. cdmo formulation api This is an order. this is an order

Speaker 12: API on the lower side, formulation on the higher side, and CDMO is on the top. API on the lower side, formulation on the higher side, and CDMO is on the top. api on the lower side formulation on the higher side and cdmo is on the top

Speaker 14: Because sequentially, we see quarter-to-quarter, there has been improvement in gross margin, while the share of formulation has increased considerably in this quarter compared to the previous quarter, which is why I was trying to understand. In fact, synthesis share has reduced, and even API share has increased, which is why I was just trying to understand if there was anything to look into as far as gross margin for the quarter is concerned. Because sequentially, we see quarter-to-quarter, there has been improvement in gross margin, while the share of formulation has increased considerably in this quarter compared to the previous quarter, which is why I was trying to understand. because sequentially we see quarter-to-quarter there has been improvement in gross margin while the share of formulation has increased considerably in this quarter compared to the previous quarter which is why i was trying to understand In fact, synthesis share has reduced, and even API share has increased, which is why I was just trying to understand if there was anything to look into as far as gross margin for the quarter is concerned. in fact synthesis share has reduced and even api share has increased which is why i was just trying to understand if there was anything to look into as far as gross margin for the quarter is concerned

Speaker 15: I think the order remains same, Tushar. I think the order remains same, Tushar. i think the order remains same tushar

Speaker 12: I think, you see, there is a product mix within the same segment, some products where higher margins were there. So there is, see, if you look at last quarter, also we had the similar gross margin. This quarter also, gross margin. And we expect to maintain gross margins of 60%, around 60%, for the coming quarter and also next financial year. I think, you see, there is a product mix within the same segment, some products where higher margins were there. i think you see there is a product mix within the same segment some products where higher margins were there So there is, see, if you look at last quarter, also we had the similar gross margin. so there is see if you look at last quarter also we had the similar gross margin This quarter also, gross margin. this quarter also gross margin And we expect to maintain gross margins of 60%, around 60%, for the coming quarter and also next financial year. and we expect to maintain gross margins of 60% around 60% for the coming quarter and also next financial year

Speaker 14: Okay, sir. That's it from my side. Thank you and all the best. Okay, sir. okay sir That's it from my side. that's it from my side Thank you and all the best. thank you and all the best

Speaker 9: Thank you. Next question is from the line of Rehan Saiyyed from Trinetra Asset Management. Please go ahead. Thank you. thank you Next question is from the line of Rehan Saiyyed from Trinetra Asset Management. next question is from the line of rehan saiyyed from trinetra asset management Please go ahead. please go ahead

Speaker 10: Yeah, good evening to the team, and congratulations for a good set of numbers, and thank you for giving me the opportunity. So, sir, I have a couple of questions. First, on the CDMO side, CDMO grew 88% in H1 FY 2026-based management and repeatedly warned that this business is lumpy. So your consolidated quarter three revenue grew only 7.5% sequentially over quarter two. So my question here is, your CDMO growth in H1 was phenomenal due to late space, MCU deliveries. Yeah, good evening to the team, and congratulations for a good set of numbers, and thank you for giving me the opportunity. yeah good evening to the team and congratulations for a good set of numbers and thank you for giving me the opportunity So, sir, I have a couple of questions. so sir i have a couple of questions First, on the CDMO side, CDMO grew 88% in H1 FY 2026-based management and repeatedly warned that this business is lumpy. first on the cdmo side cdmo grew 88% in h1 fy 2026-based management and repeatedly warned that this business is lumpy So your consolidated quarter three revenue grew only 7.5% sequentially over quarter two. so your consolidated quarter three revenue grew only 7.5% sequentially over quarter two So my question here is, your CDMO growth in H1 was phenomenal due to late space, MCU deliveries. so my question here is your cdmo growth in h1 was phenomenal due to late space mcu deliveries However, looking at the sequential revenue growth in quarter three, so it seems the lumpiness might be entering at a plateau. Is the revenue we see in quarter three the new sustainable quarterly base for CDMO, or did this quarter include a significant portion of registration batches or large quantities that might not repeat in quarter four or quarter of FY 2027? This is my first question. However, looking at the sequential revenue growth in quarter three, so it seems the lumpiness might be entering at a plateau. however looking at the sequential revenue growth in quarter three so it seems the lumpiness might be entering at a plateau Is the revenue we see in quarter three the new sustainable quarterly base for CDMO, or did this quarter include a significant portion of registration batches or large quantities that might not repeat in quarter four or quarter of FY 2027? is the revenue we see in quarter three the new sustainable quarterly base for cdmo or did this quarter include a significant portion of registration batches or large quantities that might not repeat in quarter four or quarter of fy 2027 This is my first question. this is my first question

Speaker 12: See, CDMO revenues, if you look at the overall year, nine months, we have grown significantly. We are also confident that the growth will continue like this. Although the Q3 was a little softer because of timing of deliveries to our partners. We expect the—if you look at Q4 FY 2025 versus Q4 FY 2026, we expect to grow. See, CDMO revenues, if you look at the overall year, nine months, we have grown significantly. see cdmo revenues if you look at the overall year nine months we have grown significantly We are also confident that the growth will continue like this. we are also confident that the growth will continue like this Although the Q3 was a little softer because of timing of deliveries to our partners. although the q3 was a little softer because of timing of deliveries to our partners We expect the—if you look at Q4 FY 2025 versus Q4 FY 2026, we expect to grow. we expect the—if you look at q4 fy 2025 versus q4 fy 2026 we expect to grow

Speaker 10: Okay. Okay. okay

Speaker 15: We request you to take annual revenue then a quarter-on-quarter for the CDMO. We request you to take annual revenue then a quarter-on-quarter for the CDMO. we request you to take annual revenue then a quarter-on-quarter for the cdmo

Speaker 10: Okay. Fair enough. Fair enough. And sir, my second question is around the OpEx burn on specialized modalities. So with the impressive PAD growth this quarter, the burn from specialized modalities like CGT and ADC is less visible. So however, as an analyst, I want to understand the core efficiency. Could you quantify the specific quarterly EBITDA drive from these non-revenue-generating activities? And furthermore, since you now recruited new leadership for ADCs, so is the INR 250 crore budget still sufficient, or should we expect an upward revision in OpEx as you move towards bioconjugation and fill-finish capabilities? Okay. okay Fair enough. fair enough Fair enough. fair enough And sir, my second question is around the OpEx burn on specialized modalities. and sir my second question is around the opex burn on specialized modalities So with the impressive PAD growth this quarter, the burn from specialized modalities like CGT and ADC is less visible. so with the impressive pad growth this quarter the burn from specialized modalities like cgt and adc is less visible So however, as an analyst, I want to understand the core efficiency. so however as an analyst i want to understand the core efficiency Could you quantify the specific quarterly EBITDA drive from these non-revenue-generating activities? could you quantify the specific quarterly ebitda drive from these non-revenue-generating activities And furthermore, since you now recruited new leadership for ADCs, so is the INR 250 crore budget still sufficient, or should we expect an upward revision in OpEx as you move towards bioconjugation and fill-finish capabilities? and furthermore since you now recruited new leadership for adcs so is the inr 250 crore budget still sufficient or should we expect an upward revision in opex as you move towards bioconjugation and fill-finish capabilities

Speaker 12: That's a Laurus philosophy we were informed about a lot of our investment companies. That's a Laurus philosophy we were informed about a lot of our investment companies. that's a laurus philosophy we were informed about a lot of our investment companies

Speaker 10: None of them are not clearly audited. None of them are not clearly audited. none of them are not clearly audited

Speaker 12: None of these pre-operative expenditures or any of our new initiatives is capitalized. So every new modality expenditure is expensed. So in the ADC space, we are investing significantly both in OpEx and CapEx, but that is going through the balance sheet. We are not capitalizing it. None of these pre-operative expenditures or any of our new initiatives is capitalized. none of these pre-operative expenditures or any of our new initiatives is capitalized So every new modality expenditure is expensed. so every new modality expenditure is expensed So in the ADC space, we are investing significantly both in OpEx and CapEx, but that is going through the balance sheet. so in the adc space we are investing significantly both in opex and capex but that is going through the balance sheet We are not capitalizing it. we are not capitalizing it

Speaker 10: Okay. Okay. okay

Speaker 15: Coming to your question of the team, actually, we have a separate team identified, a guy who is relocated from U.S. to India to take care of the ADC and then Noorjeen Dhilpe. Coming to your question of the team, actually, we have a separate team identified, a guy who is relocated from U.S. to India to take care of the ADC and then Noorjeen Dhilpe. coming to your question of the team actually we have a separate team identified a guy who is relocated from u.s to india to take care of the adc and then noorjeen dhilpe

Speaker 10: Okay. Okay. And my last question is on the ROC and ROE guidance that you have given in the last quarter. But management has highlighted that the company's current size can absorb the INR 1,000 crore annual CapEx better than in the past. So however, with the groundbreaking of $5.6 billion by Vizag Complex and the current turnovers of 0.9, so aren't we risking another multi-year period of operating de-leverage? Specifically, if your Bengal Bio capacity is sold out until end 2026, and new Vizag capacities are also a year away, so from this specific division, will it be incremental turnover came to bridge the gap to your 1.1 asset turnover and 25% ROC target in the next 12 months? Okay. okay Okay. okay And my last question is on the ROC and ROE guidance that you have given in the last quarter. and my last question is on the roc and roe guidance that you have given in the last quarter But management has highlighted that the company's current size can absorb the INR 1,000 crore annual CapEx better than in the past. but management has highlighted that the company's current size can absorb the inr 1,000 crore annual capex better than in the past So however, with the groundbreaking of $5.6 billion by Vizag Complex and the current turnovers of 0.9, so aren't we risking another multi-year period of operating de-leverage? so however with the groundbreaking of $5.6 billion by vizag complex and the current turnovers of 0.9 so aren't we risking another multi-year period of operating de-leverage Specifically, if your Bengal Bio capacity is sold out until end 2026, and new Vizag capacities are also a year away, so from this specific division, will it be incremental turnover came to bridge the gap to your 1.1 asset turnover and 25% ROC target in the next 12 months? specifically if your bengal bio capacity is sold out until end 2026 and new vizag capacities are also a year away so from this specific division will it be incremental turnover came to bridge the gap to your 1.1 asset turnover and 25% roc target in the next 12 months

Speaker 12: I think in case of bio, our revenues will stagnate until we operationalize our new capacity, which will be by the end of this calendar year. We are not committing that we will achieve a ROC of 25% in the next 12 months, but we are confident that the ROC percentage will go up from the current 18%. I think in case of bio, our revenues will stagnate until we operationalize our new capacity, which will be by the end of this calendar year. i think in case of bio our revenues will stagnate until we operationalize our new capacity which will be by the end of this calendar year We are not committing that we will achieve a ROC of 25% in the next 12 months, but we are confident that the ROC percentage will go up from the current 18%. we are not committing that we will achieve a roc of 25% in the next 12 months but we are confident that the roc percentage will go up from the current 18%

Speaker 10: Sir, you have said 18%, right? Sir, you have said 18%, right? sir you have said 18% right

Speaker 15: Right now, it's 18%. Right now, it's 18%. right now it's 18%

Speaker 12: Right now, it's 18.5% ROC. We expect to go up, but we are not committing it will go to 25 with a time-bound program. Yeah. Right now, it's 18.5% ROC. right now it's 18.5% roc We expect to go up, but we are not committing it will go to 25 with a time-bound program. we expect to go up but we are not committing it will go to 25 with a time-bound program Yeah. yeah

Speaker 10: Okay. So we are not putting any numbers here? Okay. okay So we are not putting any numbers here? so we are not putting any numbers here

Speaker 12: Yes. Yes. yes

Speaker 10: Okay. Okay. Fair enough. Thank you. That's it from my side. Okay. okay Okay. okay Fair enough. fair enough Thank you. thank you That's it from my side. that's it from my side

Speaker 9: Thank you. The next question is from the line of Sajal Kapoor from Antifragile Thinking. Please go ahead. Thank you. thank you The next question is from the line of Sajal Kapoor from Antifragile Thinking. the next question is from the line of sajal kapoor from antifragile thinking Please go ahead. please go ahead

Speaker 11: Yeah. Hi. Thank you for taking my question, and good afternoon, team. It's heartening to see a very strong jump in the operating cash flow. I'm looking at the nine-month number. It's about 600% increase. But there is an interesting trend here, Raviji, if you can elaborate and help us better understand this wider picture. So if I look at the 10-year data, so I'm looking at 2016 to 2025 cumulative, we clocked an EBITDA of INR 8,500 crores. And against that EBITDA of INR 8,500 crores, we did an operating cash flow of about INR 5,400 crores. So that's about 63% conversion. Whereas in the nine months, the conversion is 113%. So 63% going to 70%, 75%, even 80% is understandable. There is a definite change in the net working capital strategy. Yeah. yeah Hi. hi Thank you for taking my question, and good afternoon, team. thank you for taking my question and good afternoon team It's heartening to see a very strong jump in the operating cash flow. it's heartening to see a very strong jump in the operating cash flow I'm looking at the nine-month number. i'm looking at the nine-month number It's about 600% increase. it's about 600% increase But there is an interesting trend here, Raviji, if you can elaborate and help us better understand this wider picture. but there is an interesting trend here raviji if you can elaborate and help us better understand this wider picture So if I look at the 10-year data, so I'm looking at 2016 to 2025 cumulative, we clocked an EBITDA of INR 8,500 crores. so if i look at the 10-year data so i'm looking at 2016 to 2025 cumulative we clocked an ebitda of inr 8,500 crores And against that EBITDA of INR 8,500 crores, we did an operating cash flow of about INR 5,400 crores. and against that ebitda of inr 8,500 crores we did an operating cash flow of about inr 5,400 crores So that's about 63% conversion. so that's about 63% conversion Whereas in the nine months, the conversion is 113%. whereas in the nine months the conversion is 113% So 63% going to 70%, 75%, even 80% is understandable. so 63% going to 70% 75% even 80% is understandable There is a definite change in the net working capital strategy. there is a definite change in the net working capital strategy As far as I can understand, if you could just help us double-click and understand a more longer-term and more sustainable conversion of EBITDA into operating cash flow. Thank you. As far as I can understand, if you could just help us double-click and understand a more longer-term and more sustainable conversion of EBITDA into operating cash flow. as far as i can understand if you could just help us double-click and understand a more longer-term and more sustainable conversion of ebitda into operating cash flow Thank you. thank you

Speaker 15: Sajal, thanks for your very interesting question. So this kind of help happened because of some of the customer advances which helped this year. But of course, if you look at the absolute number of the NWCs close to the similar number for the March and December, but the revenue has increased. That's really helped. But you are right, from 63% to 80%, 90%, but beyond that, actually, some part is helped through customer advances. Thank you for your in detail understanding. Sajal, thanks for your very interesting question. sajal thanks for your very interesting question So this kind of help happened because of some of the customer advances which helped this year. so this kind of help happened because of some of the customer advances which helped this year But of course, if you look at the absolute number of the NWCs close to the similar number for the March and December, but the revenue has increased. but of course if you look at the absolute number of the nwcs close to the similar number for the march and december but the revenue has increased That's really helped. that's really helped But you are right, from 63% to 80%, 90%, but beyond that, actually, some part is helped through customer advances. but you are right from 63% to 80% 90% but beyond that actually some part is helped through customer advances Thank you for your in detail understanding. thank you for your in detail understanding

Speaker 11: Sure, Raviji. Just to harp on that one, so given that the business characteristic is definitely changing in the favor of CDMO, and these customer advances will be an ongoing thing, we cannot compare quarter-over-quarter for advances because in one year, the advance may be higher than the other year. But on a broader five-year basis for the going forward five years, I think the conversion should be a lot better than what we have delivered in the last 10 years. Is that a fair assumption? Sure, Raviji. sure raviji Just to harp on that one, so given that the business characteristic is definitely changing in the favor of CDMO, and these customer advances will be an ongoing thing, we cannot compare quarter-over-quarter for advances because in one year, the advance may be higher than the other year. just to harp on that one so given that the business characteristic is definitely changing in the favor of cdmo and these customer advances will be an ongoing thing we cannot compare quarter-over-quarter for advances because in one year the advance may be higher than the other year But on a broader five-year basis for the going forward five years, I think the conversion should be a lot better than what we have delivered in the last 10 years. but on a broader five-year basis for the going forward five years i think the conversion should be a lot better than what we have delivered in the last 10 years Is that a fair assumption? is that a fair assumption

Speaker 15: Yeah, that's a fair assumption. Yeah, that's a fair assumption. yeah that's a fair assumption

Speaker 11: Okay. Thank you. Thank you. My second question is for you, Dr. Satya. Where not to go or what not to do is also equally important because businesses have got finite cash flows and capabilities. So in that context, what is that one area where Laurus has chosen not to grow despite opportunity looking very interesting in the near term? Okay. okay Thank you. thank you Thank you. thank you My second question is for you, Dr. Satya. my second question is for you dr satya Where not to go or what not to do is also equally important because businesses have got finite cash flows and capabilities. where not to go or what not to do is also equally important because businesses have got finite cash flows and capabilities So in that context, what is that one area where Laurus has chosen not to grow despite opportunity looking very interesting in the near term? so in that context what is that one area where laurus has chosen not to grow despite opportunity looking very interesting in the near term

Speaker 12: Very thought-provoking question you asked, Sajal. See, right now, we decide not to enter into large-scale mAb manufacturing. We don't want to do that. That area, we decide not to get in. The other area we decide not to enter right now is also sterile manufacturing. These two areas we decide not to enter. Although opportunity looks good, but we also need to understand our management bandwidth to handle many things. So we know right now we are busy with what we are handling. We have visibility about our growth plans in the next two, three, four, five years. So we are cautious in the areas where we wanted to enter and deploy our resources, both material and money. Yeah. Very thought-provoking question you asked, Sajal. very thought-provoking question you asked sajal See, right now, we decide not to enter into large-scale mAb manufacturing. see right now we decide not to enter into large-scale mab manufacturing We don't want to do that. we don't want to do that That area, we decide not to get in. that area we decide not to get in The other area we decide not to enter right now is also sterile manufacturing. the other area we decide not to enter right now is also sterile manufacturing These two areas we decide not to enter. these two areas we decide not to enter Although opportunity looks good, but we also need to understand our management bandwidth to handle many things. although opportunity looks good but we also need to understand our management bandwidth to handle many things So we know right now we are busy with what we are handling. so we know right now we are busy with what we are handling We have visibility about our growth plans in the next two, three, four, five years. we have visibility about our growth plans in the next two three four five years So we are cautious in the areas where we wanted to enter and deploy our resources, both material and money. so we are cautious in the areas where we wanted to enter and deploy our resources both material and money Yeah. yeah

Speaker 11: That's understandable, Laurus Satya, because if you look at India, I've seen many large sterile and mAb monoclonal antibody players. One of the leaders in that space are struggling when it comes to their balance sheet and the ROCE profile. So completely understand that strategy, and thank you for clarifying. Thank you. That's all from my side. Thank you. That's understandable, Laurus Satya, because if you look at India, I've seen many large sterile and mAb monoclonal antibody players. that's understandable laurus satya because if you look at india i've seen many large sterile and mab monoclonal antibody players One of the leaders in that space are struggling when it comes to their balance sheet and the ROCE profile. one of the leaders in that space are struggling when it comes to their balance sheet and the roce profile So completely understand that strategy, and thank you for clarifying. so completely understand that strategy and thank you for clarifying Thank you. thank you That's all from my side. that's all from my side Thank you. thank you

Speaker 9: Thank you. The next question is from the line of Mehul Panjwani from 40 Cents. Please go ahead. Thank you. thank you The next question is from the line of Mehul Panjwani from 40 Cents. the next question is from the line of mehul panjwani from 40 cents Please go ahead. please go ahead

Speaker 7: Hello, sir. Thank you so much for the opportunity and congratulations on a great set of numbers. Sir, if you can elaborate a little bit on that, that is my first question. On the joint venture with KRKA, can you please elaborate what are we doing? Because I am not tracking. I'm recently tracking this company. Hello, sir. hello sir Thank you so much for the opportunity and congratulations on a great set of numbers. thank you so much for the opportunity and congratulations on a great set of numbers Sir, if you can elaborate a little bit on that, that is my first question. sir if you can elaborate a little bit on that that is my first question On the joint venture with KRKA, can you please elaborate what are we doing? on the joint venture with krka can you please elaborate what are we doing Because I am not tracking. because i am not tracking I'm recently tracking this company. i'm recently tracking this company

Speaker 12: The joint venture with KRKA is to manufacture formulations for the European market where APIs will be supplied by us. In the phase I, we are creating 3 billion solid oral capacity and 100 million solid oral capacity for potent molecules. In the phase II, we will create another 5 billion tablet capacity in the solid oral space. Phase I, we expect to complete by mid-2027. This unit will primarily do formulations packaging for various European markets and also some markets in Asia Pacific as well. The joint venture with KRKA is to manufacture formulations for the European market where APIs will be supplied by us. the joint venture with krka is to manufacture formulations for the european market where apis will be supplied by us In the phase I, we are creating 3 billion solid oral capacity and 100 million solid oral capacity for potent molecules. in the phase i we are creating 3 billion solid oral capacity and 100 million solid oral capacity for potent molecules In the phase II, we will create another 5 billion tablet capacity in the solid oral space. in the phase ii we will create another 5 billion tablet capacity in the solid oral space Phase I, we expect to complete by mid-2027. phase i we expect to complete by mid-2027 This unit will primarily do formulations packaging for various European markets and also some markets in Asia Pacific as well. this unit will primarily do formulations packaging for various european markets and also some markets in asia pacific as well

Speaker 7: Right, sir. Thank you, sir. And the second question is on cell and gene update, gene therapy. If you can highlight or elaborate what kind of revenues will kick in and what are we trying to achieve for a layman who understands a little bit about pharma, it will be helpful. Thank you. Right, sir. right sir Thank you, sir. thank you sir And the second question is on cell and gene update, gene therapy. and the second question is on cell and gene update gene therapy If you can highlight or elaborate what kind of revenues will kick in and what are we trying to achieve for a layman who understands a little bit about pharma, it will be helpful. if you can highlight or elaborate what kind of revenues will kick in and what are we trying to achieve for a layman who understands a little bit about pharma it will be helpful Thank you. thank you

Speaker 12: In the cell therapy, our associate company, ImmunoAct, is already having commercial revenues. When it comes to gene therapy, we are at very initial stage of investments in antibody drug conjugation gene therapy. Our process development labs were operationalized, and the GMP facilities will come in the next 12 months. We don't expect any revenues from ADCs and gene therapy, at least in the next 24 months. In the cell therapy, our associate company, ImmunoAct, is already having commercial revenues. in the cell therapy our associate company immunoact is already having commercial revenues When it comes to gene therapy, we are at very initial stage of investments in antibody drug conjugation gene therapy. when it comes to gene therapy we are at very initial stage of investments in antibody drug conjugation gene therapy Our process development labs were operationalized, and the GMP facilities will come in the next 12 months. our process development labs were operationalized and the gmp facilities will come in the next 12 months We don't expect any revenues from ADCs and gene therapy, at least in the next 24 months. we don't expect any revenues from adcs and gene therapy at least in the next 24 months

Speaker 7: Right, sir. And what about the joint venture with KRKA? Right, sir. right sir And what about the joint venture with KRKA? and what about the joint venture with krka

Speaker 12: We will have revenues in the next financial, not in this financial year. Yeah. We will have revenues in the next financial, not in this financial year. we will have revenues in the next financial not in this financial year Yeah. yeah

Speaker 7: Okay. Thank you so much, sir. Thank you. All the best. Okay. okay Thank you so much, sir. thank you so much sir Thank you. thank you All the best. all the best

Speaker 12: Thank you. Thank you. thank you

Speaker 9: Thank you. Ladies and gentlemen, we request you to please use handsets while asking a question. The next question is from the line of Chirag Shah from White Pine Investment Management. Please go ahead. Mr. Chirag, please go ahead with your question. Your line is unmuted. Thank you. thank you Ladies and gentlemen, we request you to please use handsets while asking a question. ladies and gentlemen we request you to please use handsets while asking a question The next question is from the line of Chirag Shah from White Pine Investment Management. the next question is from the line of chirag shah from white pine investment management Please go ahead. please go ahead Mr. Chirag, please go ahead with your question. mr chirag please go ahead with your question Your line is unmuted. your line is unmuted

Speaker 2: Hello. Am I audible? Hello. hello Am I audible? am i audible

Speaker 9: Yes, you are. Please go ahead. Yes, you are. yes you are Please go ahead. please go ahead

Speaker 2: Yeah. So first question is both for CDMO as well as for API and FDF business. Q1, Q1, YOY, if you can just highlight, is there anything with respect to volume and pricing, especially in API and FDF? Have we benefited on pricing in API and FDF? Yeah. yeah So first question is both for CDMO as well as for API and FDF business. so first question is both for cdmo as well as for api and fdf business Q1, Q1, YOY, if you can just highlight, is there anything with respect to volume and pricing, especially in API and FDF? q1 q1 yoy if you can just highlight is there anything with respect to volume and pricing especially in api and fdf Have we benefited on pricing in API and FDF? have we benefited on pricing in api and fdf

Speaker 12: In the API, FDF, we predominantly benefited from the volume gain. In the API, FDF, we predominantly benefited from the volume gain. in the api fdf we predominantly benefited from the volume gain

Speaker 2: Okay. Okay. So pricing has not really changed much, correct? Okay. okay Okay. okay So pricing has not really changed much, correct? so pricing has not really changed much correct

Speaker 12: Pricing hasn't played a significant role in this. The volume gain was significant. Pricing hasn't played a significant role in this. pricing hasn't played a significant role in this The volume gain was significant. the volume gain was significant

Speaker 2: Was the main reason. Okay. Sir, second follow-up, just a clarification also on the CDMO side. If you look at sequentially, CDMO revenue would be up, is down by 13%, YOY up by 1%. Now, in the last two calls, we have been indicating supplies to late-stage development as well as commercials. So despite that, we are seeing a flattening out of revenue. So is there any callout you would like to make on that side? The ideal is commercials are playing out, then the ramp-up should be slightly higher before we start flattening out and the new molecule pipeline starts replacing or compensating for that. Was the main reason. was the main reason Okay. okay Sir, second follow-up, just a clarification also on the CDMO side. sir second follow-up just a clarification also on the cdmo side If you look at sequentially, CDMO revenue would be up, is down by 13%, YOY up by 1%. if you look at sequentially cdmo revenue would be up is down by 13% yoy up by 1% Now, in the last two calls, we have been indicating supplies to late-stage development as well as commercials. now in the last two calls we have been indicating supplies to late-stage development as well as commercials So despite that, we are seeing a flattening out of revenue. so despite that we are seeing a flattening out of revenue So is there any callout you would like to make on that side? so is there any callout you would like to make on that side The ideal is commercials are playing out, then the ramp-up should be slightly higher before we start flattening out and the new molecule pipeline starts replacing or compensating for that. the ideal is commercials are playing out then the ramp-up should be slightly higher before we start flattening out and the new molecule pipeline starts replacing or compensating for that

Speaker 12: Yeah. Even while the late-stage supplies and also commercial supplies are ongoing, even in such situations, some of these supplies are once or twice per year in some cases. So there's not necessarily a supply going out every month. It comes down to their internal manufacturing capacity and demand requirements. So even in the case of it going commercial, we'll continue to expect lumpiness in some of the programs. I won't say that's the case for all, but some of the programs, you will continue to see that lumpiness on a quarter-to-quarter basis. Yeah. yeah Even while the late-stage supplies and also commercial supplies are ongoing, even in such situations, some of these supplies are once or twice per year in some cases. even while the late-stage supplies and also commercial supplies are ongoing even in such situations some of these supplies are once or twice per year in some cases So there's not necessarily a supply going out every month. so there's not necessarily a supply going out every month It comes down to their internal manufacturing capacity and demand requirements. it comes down to their internal manufacturing capacity and demand requirements So even in the case of it going commercial, we'll continue to expect lumpiness in some of the programs. so even in the case of it going commercial we'll continue to expect lumpiness in some of the programs I won't say that's the case for all, but some of the programs, you will continue to see that lumpiness on a quarter-to-quarter basis. i won't say that's the case for all but some of the programs you will continue to see that lumpiness on a quarter-to-quarter basis

Speaker 15: On the annual basis, you have to look at on the annual basis, number one. And number two, on the annual basis, we are still committing to our earlier projection for the CDMO for the full year. On the annual basis, you have to look at on the annual basis, number one. on the annual basis you have to look at on the annual basis number one And number two, on the annual basis, we are still committing to our earlier projection for the CDMO for the full year. and number two on the annual basis we are still committing to our earlier projection for the cdmo for the full year

Speaker 12: That's correct. That's correct. that's correct

Speaker 2: Yeah. Yeah. And sir, I was more keen on 27 because some new molecule supply has to start for us to compensate for this lumpiness, correct? Else we will see a kind of a flattening out or maybe 5%-10% kind of a growth in CDMO business. So if you can just talk a bit about that, how to look at 27 in CDMO revenue growth? Yeah. yeah Yeah. yeah And sir, I was more keen on 27 because some new molecule supply has to start for us to compensate for this lumpiness, correct? and sir i was more keen on 27 because some new molecule supply has to start for us to compensate for this lumpiness correct Else we will see a kind of a flattening out or maybe 5%-10% kind of a growth in CDMO business. else we will see a kind of a flattening out or maybe 5%-10% kind of a growth in cdmo business So if you can just talk a bit about that, how to look at 27 in CDMO revenue growth? so if you can just talk a bit about that how to look at 27 in cdmo revenue growth

Speaker 12: While we are not giving any concrete numbers for 2027, we still expect a healthy growth over whatever we expect to report in 2026. While we are not giving any concrete numbers for 2027, we still expect a healthy growth over whatever we expect to report in 2026. while we are not giving any concrete numbers for 2027 we still expect a healthy growth over whatever we expect to report in 2026 So if you look at FY 2026, in the nine months, our growth is close to 50%. And we expect Q4, as I mentioned just now with another question, about Q4 FY 2027, we indicated that our Q4 FY 2026 will be better than Q4 FY 2026. So we have visibility now how FY 2027 looks like, but we are not giving any quantitative guidance. It's qualitative. So if you look at FY 2026, in the nine months, our growth is close to 50%. so if you look at fy 2026 in the nine months our growth is close to 50% And we expect Q4, as I mentioned just now with another question, about Q4 FY 2027, we indicated that our Q4 FY 2026 will be better than Q4 FY 2026. and we expect q4 as i mentioned just now with another question about q4 fy 2027 we indicated that our q4 fy 2026 will be better than q4 fy 2026 So we have visibility now how FY 2027 looks like, but we are not giving any quantitative guidance. so we have visibility now how fy 2027 looks like but we are not giving any quantitative guidance It's qualitative. it's qualitative

Speaker 2: It's more about qualitative. It's more about, are there any large molecules coming up for supplies for you in 27 based on the pipeline that you have created over the last two, three years? Is that the way to think that will drive the growth? It's more about qualitative. it's more about qualitative It's more about, are there any large molecules coming up for supplies for you in 27 based on the pipeline that you have created over the last two, three years? it's more about are there any large molecules coming up for supplies for you in 27 based on the pipeline that you have created over the last two three years Is that the way to think that will drive the growth? is that the way to think that will drive the growth

Speaker 12: The majority of FI27 revenues in our CDMO division will be commercial supplies. I think that much I can make a statement. Yeah. Majority commercial supplies. The majority of FI27 revenues in our CDMO division will be commercial supplies. the majority of fi27 revenues in our cdmo division will be commercial supplies I think that much I can make a statement. i think that much i can make a statement Yeah. yeah Majority commercial supplies. majority commercial supplies

Speaker 2: Okay. And sir, one last this, because this is more with the gross margin improvement that we have seen. Has currency played any role in your gross margin improvement? Because sequentially, we would have benefited reasonably on the USD-INR movement and USD-EUR movement also for that matter. Okay. okay And sir, one last this, because this is more with the gross margin improvement that we have seen. and sir one last this because this is more with the gross margin improvement that we have seen Has currency played any role in your gross margin improvement? has currency played any role in your gross margin improvement Because sequentially, we would have benefited reasonably on the USD-INR movement and USD-EUR movement also for that matter. because sequentially we would have benefited reasonably on the usd-inr movement and usd-eur movement also for that matter

Speaker 12: Significant. Answer is yes, but not very significant. Significant. significant Answer is yes, but not very significant. answer is yes but not very significant

Speaker 2: Could it contribute 20, 30 basis points or even 40, 50 basis points of gross margin improvement sequentially given the adverse? This is in context of adverse mix in the broader segment. CDMO share is down, APS share is significantly up. That's why I was asking. Could it contribute 20, 30 basis points or even 40, 50 basis points of gross margin improvement sequentially given the adverse? could it contribute 20 30 basis points or even 40 50 basis points of gross margin improvement sequentially given the adverse This is in context of adverse mix in the broader segment. this is in context of adverse mix in the broader segment CDMO share is down, APS share is significantly up. cdmo share is down aps share is significantly up That's why I was asking. that's why i was asking

Speaker 12: We will definitely get a benefit because we are a net exporter. But I'm saying that it is not a very significant impact or positive impact. We will definitely get a benefit because we are a net exporter. we will definitely get a benefit because we are a net exporter But I'm saying that it is not a very significant impact or positive impact. but i'm saying that it is not a very significant impact or positive impact

Speaker 2: Okay. Thank you and all the best. Okay. okay Thank you and all the best. thank you and all the best

Speaker 9: Thank you. The next question is from the line of Jeevan from Sahasrar Capital. Please go ahead. Thank you. thank you The next question is from the line of Jeevan from Sahasrar Capital. the next question is from the line of jeevan from sahasrar capital Please go ahead. please go ahead

Speaker 4: It's very heartening to hear the guidance of 60% gross margin going forward. I think it's very, very positive. Coming to the CDMO side, sir, I just want to understand your FY 2027, so one is the animal health. So I don't think animal health has still scaled up in '25 much. So animal health, how do you see the scale-up in FY 2027? Agrochemical also, I don't think FY 2026 we have done much of a delivery there. So how do you see agrochemical growing in FY 2027? And apart from that, is there any large contract that we are talking or are in the pipeline with the big pharma? If you can speak on that. It's very heartening to hear the guidance of 60% gross margin going forward. it's very heartening to hear the guidance of 60% gross margin going forward I think it's very, very positive. i think it's very very positive Coming to the CDMO side, sir, I just want to understand your FY 2027, so one is the animal health. coming to the cdmo side sir i just want to understand your fy 2027 so one is the animal health So I don't think animal health has still scaled up in '25 much. so i don't think animal health has still scaled up in '25 much So animal health, how do you see the scale-up in FY 2027? so animal health how do you see the scale-up in fy 2027 Agrochemical also, I don't think FY 2026 we have done much of a delivery there. agrochemical also i don't think fy 2026 we have done much of a delivery there So how do you see agrochemical growing in FY 2027? so how do you see agrochemical growing in fy 2027 And apart from that, is there any large contract that we are talking or are in the pipeline with the big pharma? and apart from that is there any large contract that we are talking or are in the pipeline with the big pharma If you can speak on that. if you can speak on that

Speaker 12: Yes. On the animal health, there's ongoing commercial supplies for a few compounds, continue to do validations and filings for our partners in other programs. So there is some meaningful revenue for this year as well, and we expect to continue that or, in fact, grow on that. In the crop science space, we've commercialized one particular supplies for our partner, and we expect that to continue shipments in the coming years as well. But we look forward to adding more partners in the crop science space, but meaningful revenues for the crop science probably will start maybe two years or one to two years down the road. Yes. yes On the animal health, there's ongoing commercial supplies for a few compounds, continue to do validations and filings for our partners in other programs. on the animal health there's ongoing commercial supplies for a few compounds continue to do validations and filings for our partners in other programs So there is some meaningful revenue for this year as well, and we expect to continue that or, in fact, grow on that. so there is some meaningful revenue for this year as well and we expect to continue that or in fact grow on that In the crop science space, we've commercialized one particular supplies for our partner, and we expect that to continue shipments in the coming years as well. in the crop science space we've commercialized one particular supplies for our partner and we expect that to continue shipments in the coming years as well But we look forward to adding more partners in the crop science space, but meaningful revenues for the crop science probably will start maybe two years or one to two years down the road. but we look forward to adding more partners in the crop science space but meaningful revenues for the crop science probably will start maybe two years or one to two years down the road

Speaker 4: Okay. And. Okay. okay And. and

Speaker 12: Yeah. Yeah. yeah

Speaker 4: Yeah. Good. Yeah. yeah Good. good

Speaker 12: Yeah. On the second question on the large commercial contracts, I mean, unfortunately, I can't necessarily comment on that, but we continue to have good discussions with several partners in several phases of the programs. Yeah. yeah On the second question on the large commercial contracts, I mean, unfortunately, I can't necessarily comment on that, but we continue to have good discussions with several partners in several phases of the programs. on the second question on the large commercial contracts i mean unfortunately i can't necessarily comment on that but we continue to have good discussions with several partners in several phases of the programs

Speaker 4: Yeah. So are you basically seeing any cases where the innovator or large pharma is looking to move late-stage molecules from other clients to us? Yeah. yeah So are you basically seeing any cases where the innovator or large pharma is looking to move late-stage molecules from other clients to us? so are you basically seeing any cases where the innovator or large pharma is looking to move late-stage molecules from other clients to us

Speaker 12: The opportunities exist, but unfortunately, without divulging confidential information, I can't really fully comment on that. So yes. The opportunities exist, but unfortunately, without divulging confidential information, I can't really fully comment on that. the opportunities exist but unfortunately without divulging confidential information i can't really fully comment on that So yes. so yes

Speaker 4: Okay. No problem. No problem. Thanks a lot. And next question is about ImmunoAct. So I think we have done recently tie-up with Cipla for South Africa region. So any comment on that? How do you see that market or how do you see that opportunity? Okay. okay No problem. no problem No problem. no problem Thanks a lot. thanks a lot And next question is about ImmunoAct. and next question is about immunoact So I think we have done recently tie-up with Cipla for South Africa region. so i think we have done recently tie-up with cipla for south africa region So any comment on that? so any comment on that How do you see that market or how do you see that opportunity? how do you see that market or how do you see that opportunity

Speaker 12: That opportunity will be meaningful only a year from now because of the regulatory approval needed in South Africa. So clinical trials will start soon in South Africa, for ImmunoAct. So it will be FY 2028, you will see that. But there are some milestones ImmunoAct already received from Cipla. That opportunity will be meaningful only a year from now because of the regulatory approval needed in South Africa. that opportunity will be meaningful only a year from now because of the regulatory approval needed in south africa So clinical trials will start soon in South Africa, for ImmunoAct. so clinical trials will start soon in south africa for immunoact So it will be FY 2028, you will see that. so it will be fy 2028 you will see that But there are some milestones ImmunoAct already received from Cipla. but there are some milestones immunoact already received from cipla

Speaker 4: Okay. Great, sir. Great. Thanks a lot. Okay. okay Great, sir. great sir Great. great Thanks a lot. thanks a lot

Speaker 12: Thank you. Thank you. thank you

Speaker 9: Thank you. The next question is from the line of Bharat Siriparupu from Quest for Value Capital. Please go ahead. Thank you. thank you The next question is from the line of Bharat Siriparupu from Quest for Value Capital. the next question is from the line of bharat siriparupu from quest for value capital Please go ahead. please go ahead

Speaker 1: Yeah. Congrats for boosted numbers. Dr. Chava, regarding this new greenfield CapEx of 500 acres in Achutapuram, may I know when can we expect this new greenfield CapEx start coming online? Can we expect first phase of it to come somewhere in FY 2028? Yeah. yeah Congrats for boosted numbers. congrats for boosted numbers Dr. Chava, regarding this new greenfield CapEx of 500 acres in Achutapuram, may I know when can we expect this new greenfield CapEx start coming online? dr chava regarding this new greenfield capex of 500 acres in achutapuram may i know when can we expect this new greenfield capex start coming online Can we expect first phase of it to come somewhere in FY 2028? can we expect first phase of it to come somewhere in fy 2028

Speaker 12: We are expecting land allotment, and handover will happen in the Q4 this year, financial year. CapEx will start from maybe second quarter of FY 2027, and we expect qualification and validations only two years from now, not before. We are expecting land allotment, and handover will happen in the Q4 this year, financial year. we are expecting land allotment and handover will happen in the q4 this year financial year CapEx will start from maybe second quarter of FY 2027, and we expect qualification and validations only two years from now, not before. capex will start from maybe second quarter of fy 2027 and we expect qualification and validations only two years from now not before

Speaker 1: Okay. Good. And my second question is to Krishna Chaitanya Chava. So currently, if you see there is a significant wave of demand coming to India on small molecule side from Innovators. So basically, what I understand is that the Innovators are chasing for capacity. Yeah. So with this background, how is Laurus prepared to handle this surge of demand? Are the current capacities sufficient to satisfy the CDMO demand? And are we considering scenarios like freeing up generic capacities and allocating them to CDMO? Okay. okay Good. good And my second question is to Krishna Chaitanya Chava. and my second question is to krishna chaitanya chava So currently, if you see there is a significant wave of demand coming to India on small molecule side from Innovators. so currently if you see there is a significant wave of demand coming to india on small molecule side from innovators So basically, what I understand is that the Innovators are chasing for capacity. so basically what i understand is that the innovators are chasing for capacity Yeah. yeah So with this background, how is Laurus prepared to handle this surge of demand? so with this background how is laurus prepared to handle this surge of demand Are the current capacities sufficient to satisfy the CDMO demand? are the current capacities sufficient to satisfy the cdmo demand And are we considering scenarios like freeing up generic capacities and allocating them to CDMO? and are we considering scenarios like freeing up generic capacities and allocating them to cdmo

Speaker 5: I think one of the strategies that we've adopted is investing ahead of time. That was the case over the last couple of years where we continued to do significant amount of CapEx. That was in line with what we were expecting from capacity requirements and customer additions. Therefore, that has positioned us strongly to meet some of these new opportunities that are coming about. That's also in line with our current guidance on CapEx for this year and the next year. This is to create capacities for our partners and opportunities that we are seeing. I think one of the strategies that we've adopted is investing ahead of time. i think one of the strategies that we've adopted is investing ahead of time That was the case over the last couple of years where we continued to do significant amount of CapEx. that was the case over the last couple of years where we continued to do significant amount of capex That was in line with what we were expecting from capacity requirements and customer additions. that was in line with what we were expecting from capacity requirements and customer additions Therefore, that has positioned us strongly to meet some of these new opportunities that are coming about. therefore that has positioned us strongly to meet some of these new opportunities that are coming about That's also in line with our current guidance on CapEx for this year and the next year. that's also in line with our current guidance on capex for this year and the next year This is to create capacities for our partners and opportunities that we are seeing. this is to create capacities for our partners and opportunities that we are seeing

Speaker 1: Basically, we didn't lose any business because of not having capacity basically till now? Basically, we didn't lose any business because of not having capacity basically till now? basically we didn't lose any business because of not having capacity basically till now

Speaker 5: That's a fair statement to make, yes. That's a fair statement to make, yes. that's a fair statement to make yes

Speaker 1: Okay. Yeah. Thank you. Okay. okay Yeah. yeah Thank you. thank you

Speaker 5: Thank you very much. Thank you very much. thank you very much

Speaker 1: And my last question is to Soumya Garu. So if on generic, so recently, 3 billion tablet capacity has come online in year two for KRKA. So may I know from when do we expect to generate revenue from this new capacity? And my last question is to Soumya Garu. and my last question is to soumya garu So if on generic, so recently, 3 billion tablet capacity has come online in year two for KRKA. so if on generic so recently 3 billion tablet capacity has come online in year two for krka So may I know from when do we expect to generate revenue from this new capacity? so may i know from when do we expect to generate revenue from this new capacity

Speaker 13: We've already started using the additional capacity, and we will see a little bit of increase or jump from next calendar year, from next financial year, next quarter Q1. We've already started using the additional capacity, and we will see a little bit of increase or jump from next calendar year, from next financial year, next quarter Q1. we've already started using the additional capacity and we will see a little bit of increase or jump from next calendar year from next financial year next quarter q1

Speaker 1: Okay. Yeah. Thank you. Thank you very much. Yeah. That's it from my side. Yeah. Okay. okay Yeah. yeah Thank you. thank you Thank you very much. thank you very much Yeah. yeah That's it from my side. that's it from my side Yeah. yeah

Speaker 12: Thank you, Bharat. Thank you, Bharat. thank you bharat

Speaker 9: Thank you. The next question is from the line of Vivek Agarwal from Citigroup. Please go ahead. Thank you. thank you The next question is from the line of Vivek Agarwal from Citigroup. the next question is from the line of vivek agarwal from citigroup Please go ahead. please go ahead

Speaker 16: Yeah. Thanks for the opportunity. So first question is related to peptides. So you are making ongoing investments. So just want to understand how much or what kind of investments you are making here, let's say, over the next couple of years, and when you see the revenues starting from this particular segment. Thank you. Yeah. yeah Thanks for the opportunity. thanks for the opportunity So first question is related to peptides. so first question is related to peptides So you are making ongoing investments. so you are making ongoing investments So just want to understand how much or what kind of investments you are making here, let's say, over the next couple of years, and when you see the revenues starting from this particular segment. so just want to understand how much or what kind of investments you are making here let's say over the next couple of years and when you see the revenues starting from this particular segment Thank you. thank you

Speaker 12: I think we'll give more details at an appropriate time, Vivek, on this. But I can give you a glimpse. We are creating capacity for fully integrated programs, protected amino acids, unnatural amino acids, fragments, final peptides, and purification isolation. So the capacity being created is fully integrated. Yeah. We'll give you more details at an appropriate time. I think we'll give more details at an appropriate time, Vivek, on this. i think we'll give more details at an appropriate time vivek on this But I can give you a glimpse. but i can give you a glimpse We are creating capacity for fully integrated programs, protected amino acids, unnatural amino acids, fragments, final peptides, and purification isolation. we are creating capacity for fully integrated programs protected amino acids unnatural amino acids fragments final peptides and purification isolation So the capacity being created is fully integrated. so the capacity being created is fully integrated Yeah. yeah We'll give you more details at an appropriate time. we'll give you more details at an appropriate time

Speaker 16: Yeah. So just try to understand more. So is it like that you already have some contracts or talks with some of the big pharma, or is it like you are creating the capacity first, and then, for example, you are expecting some kind of business from this facility? Yeah. yeah So just try to understand more. so just try to understand more So is it like that you already have some contracts or talks with some of the big pharma, or is it like you are creating the capacity first, and then, for example, you are expecting some kind of business from this facility? so is it like that you already have some contracts or talks with some of the big pharma or is it like you are creating the capacity first and then for example you are expecting some kind of business from this facility

Speaker 12: I think I can't give you more details on this. I think I can't give you more details on this. i think i can't give you more details on this

Speaker 16: And no problem at all. And in CDMO, actually, just building on the comments that you made during the call. So in 4Q, you are expecting growth YOY. So just want to understand, is the growth expected to come from a supply of a new commercial molecule, or is it kind of a late-stage molecule? If you can provide some more color. And no problem at all. and no problem at all And in CDMO, actually, just building on the comments that you made during the call. and in cdmo actually just building on the comments that you made during the call So in 4Q, you are expecting growth YOY. so in 4q you are expecting growth yoy So just want to understand, is the growth expected to come from a supply of a new commercial molecule, or is it kind of a late-stage molecule? so just want to understand is the growth expected to come from a supply of a new commercial molecule or is it kind of a late-stage molecule If you can provide some more color. if you can provide some more color

Speaker 12: Most of the revenue in Q4 is going to come from commercial supplies of molecules what we supplied earlier. Most of the revenue in Q4 is going to come from commercial supplies of molecules what we supplied earlier. most of the revenue in q4 is going to come from commercial supplies of molecules what we supplied earlier

Speaker 16: Okay. Understood. And just last question on CDMO. So in calendar year 2026, right, so how many commercial molecules, the new commercial molecules you are going to supply? Okay. okay Understood. understood And just last question on CDMO. and just last question on cdmo So in calendar year 2026, right, so how many commercial molecules, the new commercial molecules you are going to supply? so in calendar year 2026 right so how many commercial molecules the new commercial molecules you are going to supply

Speaker 12: In the last 18 months, I can give you because we did add a review internally. We supplied three commercial NCs in the last 18 months. In the last 18 months, I can give you because we did add a review internally. in the last 18 months i can give you because we did add a review internally We supplied three commercial NCs in the last 18 months. we supplied three commercial ncs in the last 18 months

Speaker 16: Okay. Just lastly on the generics, right? In CDMO, you commented about that Q2 growth, YOY growth in the fourth quarter. How to think the performance of generic business in 4Q? In this quarter, actually, there is a significant step up. I just want to understand what is the sustainability of the step up in 3Q, and how to look this particular segment in FY 2027? Thank you. Okay. okay Just lastly on the generics, right? just lastly on the generics right In CDMO, you commented about that Q2 growth, YOY growth in the fourth quarter. in cdmo you commented about that q2 growth yoy growth in the fourth quarter How to think the performance of generic business in 4Q? how to think the performance of generic business in 4q In this quarter, actually, there is a significant step up. in this quarter actually there is a significant step up I just want to understand what is the sustainability of the step up in 3Q, and how to look this particular segment in FY 2027? i just want to understand what is the sustainability of the step up in 3q and how to look this particular segment in fy 2027 Thank you. thank you

Speaker 12: In the generic space, lion's share of revenues are coming from ARVs, both APIs and formulations. That business is pretty stable. Actually, we are able to increase our market share in both API and formulations in that. Our North American formulation and European CMO sales are also going up. I think we believe those numbers what we did in Q3 are sustainable. Yeah. In the generic space, lion's share of revenues are coming from ARVs, both APIs and formulations. in the generic space lion's share of revenues are coming from arvs both apis and formulations That business is pretty stable. that business is pretty stable Actually, we are able to increase our market share in both API and formulations in that. actually we are able to increase our market share in both api and formulations in that Our North American formulation and European CMO sales are also going up. our north american formulation and european cmo sales are also going up I think we believe those numbers what we did in Q3 are sustainable. i think we believe those numbers what we did in q3 are sustainable Yeah. yeah

Speaker 16: Understood, sir. Thank you. That's from my side. Understood, sir. understood sir Thank you. thank you That's from my side. that's from my side

Speaker 9: Thank you. The next question is from the line of Ramesh, a CA. Please go ahead. Thank you. thank you The next question is from the line of Ramesh, a CA. the next question is from the line of ramesh a ca Please go ahead. please go ahead

Speaker 17: This is to Mr. Ravi Kumar. Just I want to understand why there was a, I mean, marginal growth in CDMO business quarter on quarter as compared to our generic business. You are telling for nine months, of course, I understand, but for this particular quarter, why growth was not visible? This is to Mr. Ravi Kumar. this is to mr ravi kumar Just I want to understand why there was a, I mean, marginal growth in CDMO business quarter on quarter as compared to our generic business. just i want to understand why there was a i mean marginal growth in cdmo business quarter on quarter as compared to our generic business You are telling for nine months, of course, I understand, but for this particular quarter, why growth was not visible? you are telling for nine months of course i understand but for this particular quarter why growth was not visible

Speaker 15: Can you just repeat your question? Can you just repeat your question? can you just repeat your question

Speaker 17: Why CDMO revenues are not growing? Why CDMO revenues are not growing? why cdmo revenues are not growing

Speaker 15: If your question is why CDMO revenues are not growing, it is as we indicated, you can't compare on a quarter-on-quarter for a CDMO revenue. You have to see on a year basis. So the year as for nine months, as Dr. Satya said, we already achieved a 50% growth. For a year also, we are expecting to have a higher growth, and then you don't compare on quarter-on-quarter. I hope your question is that. If your question is why CDMO revenues are not growing, it is as we indicated, you can't compare on a quarter-on-quarter for a CDMO revenue. if your question is why cdmo revenues are not growing it is as we indicated you can't compare on a quarter-on-quarter for a cdmo revenue You have to see on a year basis. you have to see on a year basis So the year as for nine months, as Dr. Satya said, we already achieved a 50% growth. so the year as for nine months as dr satya said we already achieved a 50% growth For a year also, we are expecting to have a higher growth, and then you don't compare on quarter-on-quarter. for a year also we are expecting to have a higher growth and then you don't compare on quarter-on-quarter I hope your question is that. i hope your question is that

Speaker 17: The margins are sustainable, sir, even for the next quarter? The margins are sustainable, sir, even for the next quarter? the margins are sustainable sir even for the next quarter

Speaker 15: Yes. Yes. yes

Speaker 17: Thank you. Thank you. This is from me. Thank you. thank you Thank you. thank you This is from me. this is from me

Speaker 9: Thank you. The next question is from the line of Manav Mehta from Vriddhi. Please go ahead. Thank you. thank you The next question is from the line of Manav Mehta from Vriddhi. the next question is from the line of manav mehta from vriddhi Please go ahead. please go ahead Hi, sir. Good evening. So my question is on the MOU where we are signing with LCS South Korea, where we've announced entry into OLED materials, OLED materials. So my question is, how does Laurus enter into this structure apart from pharmaceutical? Hi, sir. hi sir Good evening. good evening So my question is on the MOU where we are signing with LCS South Korea, where we've announced entry into OLED materials, OLED materials. so my question is on the mou where we are signing with lcs south korea where we've announced entry into oled materials oled materials So my question is, how does Laurus enter into this structure apart from pharmaceutical? so my question is how does laurus enter into this structure apart from pharmaceutical

Speaker 12: So similar to our strategy across different areas, right? For example, human health, animal health, and crop science, OLED represents another potential opportunity where we could be a potential player in the OLED materials, which are, again, small molecules or chemically synthesized compounds, right? For that, that's an MOU that we had agreed upon with LCS. And we don't necessarily expect to see any meaningful revenues this year or the next, but that gives us an opportunity to potentially play in this very lucrative market. So similar to our strategy across different areas, right? so similar to our strategy across different areas right For example, human health, animal health, and crop science, OLED represents another potential opportunity where we could be a potential player in the OLED materials, which are, again, small molecules or chemically synthesized compounds, right? for example human health animal health and crop science oled represents another potential opportunity where we could be a potential player in the oled materials which are again small molecules or chemically synthesized compounds right For that, that's an MOU that we had agreed upon with LCS. for that that's an mou that we had agreed upon with lcs And we don't necessarily expect to see any meaningful revenues this year or the next, but that gives us an opportunity to potentially play in this very lucrative market. and we don't necessarily expect to see any meaningful revenues this year or the next but that gives us an opportunity to potentially play in this very lucrative market

Speaker 6: Understood, sir. Thank you. Understood, sir. understood sir Thank you. thank you

Speaker 9: Thank you. The next question is from the line of Vishal Dhaga, an individual investor. Please go ahead. Thank you. thank you The next question is from the line of Vishal Dhaga, an individual investor. the next question is from the line of vishal dhaga an individual investor Please go ahead. please go ahead

Speaker 18: Hi. My question was similar to what was the previous person asked. Just to add on to the question, what will be the total time of the market in the OLED segment, maybe 2027, 2028? Hi. hi My question was similar to what was the previous person asked. my question was similar to what was the previous person asked Just to add on to the question, what will be the total time of the market in the OLED segment, maybe 2027, 2028? just to add on to the question what will be the total time of the market in the oled segment maybe 2027 2028

Speaker 12: Yeah. It's still an emerging development given that the partner program that we're working on is also a developmental program. So I can't necessarily comment on the market size itself because that's an emerging space that's currently under development. Yeah. yeah It's still an emerging development given that the partner program that we're working on is also a developmental program. it's still an emerging development given that the partner program that we're working on is also a developmental program So I can't necessarily comment on the market size itself because that's an emerging space that's currently under development. so i can't necessarily comment on the market size itself because that's an emerging space that's currently under development

Speaker 18: Understood. Okay. Thank you. Understood. understood Okay. okay Thank you. thank you

Speaker 9: Thank you. The next question is from the line of Aseem, an individual investor. Please go ahead. Thank you. thank you The next question is from the line of Aseem, an individual investor. the next question is from the line of aseem an individual investor Please go ahead. please go ahead

Speaker 19: Yeah. Hi. Thanks for the opportunity. Many congratulations for the fabulous results for quarter three. So one of my questions on the business is already answered. Thank you for that. I have one question on the financials for quarter four. If you look at the last year, quarter four, we have other income of around INR 40-50 crores, which has led to higher profitability. So my question is, what is a one-off, or we can expect a similar level of other income in this quarter as well? Yeah. yeah Hi. hi Thanks for the opportunity. thanks for the opportunity Many congratulations for the fabulous results for quarter three. many congratulations for the fabulous results for quarter three So one of my questions on the business is already answered. so one of my questions on the business is already answered Thank you for that. thank you for that I have one question on the financials for quarter four. i have one question on the financials for quarter four If you look at the last year, quarter four, we have other income of around INR 40-50 crores, which has led to higher profitability. if you look at the last year quarter four we have other income of around inr 40-50 crores which has led to higher profitability So my question is, what is a one-off, or we can expect a similar level of other income in this quarter as well? so my question is what is a one-off or we can expect a similar level of other income in this quarter as well

Speaker 12: We are not expecting another income in the quarter four. We are not expecting another income in the quarter four. we are not expecting another income in the quarter four

Speaker 19: Okay. So that was a one-off for last year? Okay. okay So that was a one-off for last year? so that was a one-off for last year

Speaker 12: Yes. Yes. yes

Speaker 19: Okay. Thank you. Thank you. Okay. okay Thank you. thank you Thank you. thank you

Speaker 9: Thank you. The next question is from the line of Abhijit K, an individual investor. Please go ahead. Thank you. thank you The next question is from the line of Abhijit K, an individual investor. the next question is from the line of abhijit k an individual investor Please go ahead. please go ahead

Speaker 20: Hello. Can you hear me? Hello. hello Can you hear me? can you hear me

Speaker 12: Yes. Yes. yes

Speaker 20: Yeah. I'd like to understand. I have two questions with regards to the one question with regards to the asset turnover. May I know what is the asset turnover currently? Yeah. yeah I'd like to understand. i'd like to understand I have two questions with regards to the one question with regards to the asset turnover. i have two questions with regards to the one question with regards to the asset turnover May I know what is the asset turnover currently? may i know what is the asset turnover currently

Speaker 12: 0.91, actually. 0.91, actually. 0.91 actually

Speaker 20: Okay. 0.91. And I look at the generic business and the FDF. Mr. Chava had mentioned that you have entered into some new products, and the volume growth was there significantly, right? How sustainable is this? Because we've seen that the APA and the FDF sector has been fluctuating over the last 24 months, actually 24-36 months, if you see. But now this has been a significant ramp-up in the FDF and APA, both sectors. Is this something that we can expect the company to continue to grow on? Because you also have new capacity just online, as I mentioned earlier also. Okay. 0.91. okay 0.91 And I look at the generic business and the FDF. and i look at the generic business and the fdf Mr. Chava had mentioned that you have entered into some new products, and the volume growth was there significantly, right? mr chava had mentioned that you have entered into some new products and the volume growth was there significantly right How sustainable is this? how sustainable is this Because we've seen that the APA and the FDF sector has been fluctuating over the last 24 months, actually 24-36 months, if you see. because we've seen that the apa and the fdf sector has been fluctuating over the last 24 months actually 24-36 months if you see But now this has been a significant ramp-up in the FDF and APA, both sectors. but now this has been a significant ramp-up in the fdf and apa both sectors Is this something that we can expect the company to continue to grow on? is this something that we can expect the company to continue to grow on Because you also have new capacity just online, as I mentioned earlier also. because you also have new capacity just online as i mentioned earlier also

Speaker 12: The growth in generic API business could be very sustainable. When it comes to growth in our other FDF business, it will also eventually be sustainable despite up and down three quarters because our increased capacity for our CMO business in Europe with a European customer will yield revenues starting from this quarter and fully operational by next quarter. We expect those numbers are also sustainable in the long run. May not be in Q4 this year and Q1 next year, but eventually, we expect to do well there as well. The growth in generic API business could be very sustainable. the growth in generic api business could be very sustainable When it comes to growth in our other FDF business, it will also eventually be sustainable despite up and down three quarters because our increased capacity for our CMO business in Europe with a European customer will yield revenues starting from this quarter and fully operational by next quarter. when it comes to growth in our other fdf business it will also eventually be sustainable despite up and down three quarters because our increased capacity for our cmo business in europe with a european customer will yield revenues starting from this quarter and fully operational by next quarter We expect those numbers are also sustainable in the long run. we expect those numbers are also sustainable in the long run May not be in Q4 this year and Q1 next year, but eventually, we expect to do well there as well. may not be in q4 this year and q1 next year but eventually we expect to do well there as well

Speaker 20: Okay. And one last question with regards to the peptides sector that is happening. We understand that you are working with an American biotech company, and we want to understand the timelines of these projects. Is it 24 months, 36 months, or 48 months, or is it really, really unpredictable? We have seen some data that there are some trials going on in the U.S. without disclosing the company, of course. But if you can understand timelines because you've invested billions of dollars in your company, and you are looking at the future of the sector, which is obviously it is ADC and peptides, which is like a revolutionary thing in pharma. So we wanted to understand what is the timeline, if you have any visibility or anything like that. Okay. okay And one last question with regards to the peptides sector that is happening. and one last question with regards to the peptides sector that is happening We understand that you are working with an American biotech company, and we want to understand the timelines of these projects. we understand that you are working with an american biotech company and we want to understand the timelines of these projects Is it 24 months, 36 months, or 48 months, or is it really, really unpredictable? is it 24 months 36 months or 48 months or is it really really unpredictable We have seen some data that there are some trials going on in the U.S. without disclosing the company, of course. we have seen some data that there are some trials going on in the u.s without disclosing the company of course But if you can understand timelines because you've invested billions of dollars in your company, and you are looking at the future of the sector, which is obviously it is ADC and peptides, which is like a revolutionary thing in pharma. but if you can understand timelines because you've invested billions of dollars in your company and you are looking at the future of the sector which is obviously it is adc and peptides which is like a revolutionary thing in pharma So we wanted to understand what is the timeline, if you have any visibility or anything like that. so we wanted to understand what is the timeline if you have any visibility or anything like that

Speaker 12: I think you have to bear with us for some more time. We will give you the details at an appropriate time. Yeah. But as you mentioned, we are investing a significant amount in peptides as well as also a significant amount in ADCs. Yeah. I think you have to bear with us for some more time. i think you have to bear with us for some more time We will give you the details at an appropriate time. we will give you the details at an appropriate time Yeah. yeah But as you mentioned, we are investing a significant amount in peptides as well as also a significant amount in ADCs. but as you mentioned we are investing a significant amount in peptides as well as also a significant amount in adcs Yeah. yeah

Speaker 20: So in that part, can we conclude that you are trying to move from being an API or CDMO sector to a biotech company, a company that is like the longer-term vision for the organization? So in that part, can we conclude that you are trying to move from being an API or CDMO sector to a biotech company, a company that is like the longer-term vision for the organization? so in that part can we conclude that you are trying to move from being an api or cdmo sector to a biotech company a company that is like the longer-term vision for the organization

Speaker 12: No. See, our investments in biotech, for example, cell therapy, gene therapy, ADCs are most emerging fields globally. And we wanted to invest ahead of the curve and wet our hands to capture opportunities. In the case of peptides and all, we are well established. We have investment. We have programs running right now. So the answer to your question is we are more focused on small volume CDMO than large volume CDMO right now, large volume CDMO. Yeah. No. no See, our investments in biotech, for example, cell therapy, gene therapy, ADCs are most emerging fields globally. see our investments in biotech for example cell therapy gene therapy adcs are most emerging fields globally And we wanted to invest ahead of the curve and wet our hands to capture opportunities. and we wanted to invest ahead of the curve and wet our hands to capture opportunities In the case of peptides and all, we are well established. in the case of peptides and all we are well established We have investment. we have investment We have programs running right now. we have programs running right now So the answer to your question is we are more focused on small volume CDMO than large volume CDMO right now, large volume CDMO. so the answer to your question is we are more focused on small volume cdmo than large volume cdmo right now large volume cdmo Yeah. yeah

Speaker 20: Okay. All right. Thank you. Thank you. Okay. okay All right. all right Thank you. thank you Thank you. thank you

Speaker 9: Thank you. The next question is from the line of Anjan Banerjee, an individual investor. Please go ahead. Thank you. thank you The next question is from the line of Anjan Banerjee, an individual investor. the next question is from the line of anjan banerjee an individual investor Please go ahead. please go ahead

Speaker 21: Hello. Am I audible? Hello. hello Am I audible? am i audible

Speaker 12: Yes. Yes. yes

Speaker 9: Yes, sir. Yes, sir. yes sir

Speaker 21: I have a question for Dr. Chava, and thank you for the opportunity. Sir, I have a question on the CDMO space. Like we have been seeing many of the Indian pharma players, they have been expanding their capacity towards this CDMO segment. As per understanding, how big and long is this opportunity? Given that Laurus has invested so much in the last couple of years towards expanding the capability and capacity, what is the competitive advantage that Laurus Labs has as compared to its peers? That's one of my questions. I have a question for Dr. Chava, and thank you for the opportunity. i have a question for dr chava and thank you for the opportunity Sir, I have a question on the CDMO space. sir i have a question on the cdmo space Like we have been seeing many of the Indian pharma players, they have been expanding their capacity towards this CDMO segment. like we have been seeing many of the indian pharma players they have been expanding their capacity towards this cdmo segment As per understanding, how big and long is this opportunity? as per understanding how big and long is this opportunity Given that Laurus has invested so much in the last couple of years towards expanding the capability and capacity, what is the competitive advantage that Laurus Labs has as compared to its peers? given that laurus has invested so much in the last couple of years towards expanding the capability and capacity what is the competitive advantage that laurus labs has as compared to its peers That's one of my questions. that's one of my questions

Speaker 12: I don't say we have advantage. We were well prepared to take the opportunity. I'll put it that way. So people look at us if there is a complex chemistry, if there is a scale involved, if it is a flow chemistry, if it is biocatalysis, if it is high-energy chemistry, and involves scale, and we are the perfect partners. So we have invested in these modalities and created capacities. I don't say we have advantage. i don't say we have advantage We were well prepared to take the opportunity. we were well prepared to take the opportunity I'll put it that way. i'll put it that way So people look at us if there is a complex chemistry, if there is a scale involved, if it is a flow chemistry, if it is biocatalysis, if it is high-energy chemistry, and involves scale, and we are the perfect partners. so people look at us if there is a complex chemistry if there is a scale involved if it is a flow chemistry if it is biocatalysis if it is high-energy chemistry and involves scale and we are the perfect partners So we have invested in these modalities and created capacities. so we have invested in these modalities and created capacities

Speaker 21: Okay. So sir, as per you, whatever these competitors that you talked about, so is it a fair assumption that developing these capabilities is a very long-term process, and any pharma company just cannot hire scientists and just foray into these because they are very skillful operations? So is it fair that developing these and getting the customer approval is a very big thing because the capability matters a lot as compared to the capacity? So is it a fair assumption? Okay. okay So sir, as per you, whatever these competitors that you talked about, so is it a fair assumption that developing these capabilities is a very long-term process, and any pharma company just cannot hire scientists and just foray into these because they are very skillful operations? so sir as per you whatever these competitors that you talked about so is it a fair assumption that developing these capabilities is a very long-term process and any pharma company just cannot hire scientists and just foray into these because they are very skillful operations So is it fair that developing these and getting the customer approval is a very big thing because the capability matters a lot as compared to the capacity? so is it fair that developing these and getting the customer approval is a very big thing because the capability matters a lot as compared to the capacity So is it a fair assumption? so is it a fair assumption

Speaker 12: Yeah. I think initially, we are creating capabilities and then investing in capacities. So what I mentioned, Laurus currently uses enzymes at the commercial scale. Laurus uses flow chemistry at commercial scale. So we are going in phase I. First, we create capabilities and then create capacities. And we believe projects will come. Yeah. yeah I think initially, we are creating capabilities and then investing in capacities. i think initially we are creating capabilities and then investing in capacities So what I mentioned, Laurus currently uses enzymes at the commercial scale. so what i mentioned laurus currently uses enzymes at the commercial scale Laurus uses flow chemistry at commercial scale. laurus uses flow chemistry at commercial scale So we are going in phase I. so we are going in phase i First, we create capabilities and then create capacities. first we create capabilities and then create capacities And we believe projects will come. and we believe projects will come

Speaker 21: Sir, my second question is for the CDMO space only that you have constantly guided that we intend to reach that 50% of our share which will be driven from the CDMO segment overall. So is it the ceiling, or once we reach this 50%, it will look beyond the breaching rates? That 50% ceiling also. That's the second question. Sir, my second question is for the CDMO space only that you have constantly guided that we intend to reach that 50% of our share which will be driven from the CDMO segment overall. sir my second question is for the cdmo space only that you have constantly guided that we intend to reach that 50% of our share which will be driven from the cdmo segment overall So is it the ceiling, or once we reach this 50%, it will look beyond the breaching rates? so is it the ceiling or once we reach this 50% it will look beyond the breaching rates that That 50% ceiling also. that 50% ceiling also That's the second question. that's the second question

Speaker 12: I think our first goal is to reach 50%. Yeah, for a long term. We are not going to be there in the medium term. It is a long-term goal for us to get there. I think our first goal is to reach 50%. i think our first goal is to reach 50% Yeah, for a long term. yeah for a long term We are not going to be there in the medium term. we are not going to be there in the medium term It is a long-term goal for us to get there. it is a long-term goal for us to get there

Speaker 21: Okay. Thank you very much and all the best. Okay. okay Thank you very much and all the best. thank you very much and all the best

Speaker 12: Thank you. Thank you. thank you

Speaker 9: Thank you. The next question is from the line of Kodandapani, an individual investor. Please go ahead. Thank you. thank you The next question is from the line of Kodandapani, an individual investor. the next question is from the line of kodandapani an individual investor Please go ahead. please go ahead

Speaker 22: Good evening. Thank you very much for being here. Good result for this quarter. So I want to ask you, what is the exchange benefit for this quarter because of the huge reduction in the dollar? Good evening. good evening Thank you very much for being here. thank you very much for being here Good result for this quarter. good result for this quarter So I want to ask you, what is the exchange benefit for this quarter because of the huge reduction in the dollar? so i want to ask you what is the exchange benefit for this quarter because of the huge reduction in the dollar

Speaker 12: Yes, but not very significant. Yes, but not very significant. yes but not very significant

Speaker 22: Okay. Okay. Thank you. Most of the things already clarified. Very thanks. Thank you. Okay. okay Okay. okay Thank you. thank you Most of the things already clarified. most of the things already clarified Very thanks. very thanks Thank you. thank you

Speaker 12: Yeah. Okay. Thank you. Yeah. yeah Okay. okay Thank you. thank you

Speaker 22: Thank you. Thank you. thank you

Speaker 9: 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 8: Hi there. Thanks for taking my question. Sir, on the ARVs, you've been earlier mentioning that the business will sort of stabilize around INR 2,400-INR 2,500 crore. We seem to be running significantly ahead of the run rate in the current year. So has something changed in the ARV space per se which has enabled us to improve our scale in this business? And is it sustainable? Hi there. hi there Thanks for taking my question. thanks for taking my question Sir, on the ARVs, you've been earlier mentioning that the business will sort of stabilize around INR 2,400-INR 2,500 crore. sir on the arvs you've been earlier mentioning that the business will sort of stabilize around inr 2,400-inr 2,500 crore We seem to be running significantly ahead of the run rate in the current year. we seem to be running significantly ahead of the run rate in the current year So has something changed in the ARV space per se which has enabled us to improve our scale in this business? so has something changed in the arv space per se which has enabled us to improve our scale in this business And is it sustainable? and is it sustainable

Speaker 12: See, earlier, we guided INR 2,500 ± 200 crore. But you're right. Current run rate is a little beyond that. The main contributor for that is we have expanded our API capacities to meet our customer demand. That's driving our positive growth there. Now, if I have to restate that, currently, we are at INR 2,600 ± 200 crore. I'll put it that way. But fundamentally, it hasn't changed much. See, earlier, we guided INR 2,500 ± 200 crore. see earlier we guided inr 2,500 ± 200 crore But you're right. but you're right Current run rate is a little beyond that. current run rate is a little beyond that The main contributor for that is we have expanded our API capacities to meet our customer demand. the main contributor for that is we have expanded our api capacities to meet our customer demand That's driving our positive growth there. that's driving our positive growth there Now, if I have to restate that, currently, we are at INR 2,600 ± 200 crore. now if i have to restate that currently we are at inr 2,600 ± 200 crore I'll put it that way. i'll put it that way But fundamentally, it hasn't changed much. but fundamentally it hasn't changed much

Speaker 8: And sir, given there were some changes in the market landscape, has the profitability of the business also improved versus the dip it had a couple of years back? Is it a much better business profitability-wise than it was maybe a couple of years back? And sir, given there were some changes in the market landscape, has the profitability of the business also improved versus the dip it had a couple of years back? and sir given there were some changes in the market landscape has the profitability of the business also improved versus the dip it had a couple of years back Is it a much better business profitability-wise than it was maybe a couple of years back? is it a much better business profitability-wise than it was maybe a couple of years back

Speaker 12: It's profitable if we sweat assets more. That's what we're doing right now. Yeah. It's profitable if we sweat assets more. it's profitable if we sweat assets more That's what we're doing right now. that's what we're doing right now Yeah. yeah

Speaker 8: But you don't see any major change in the competitive intensity in the business in that quarter? But you don't see any major change in the competitive intensity in the business in that quarter? but you don't see any major change in the competitive intensity in the business in that quarter

Speaker 12: No. We're not seeing any. But Nitin, actually, what happened, actually, we suffered for a few quarters because of the steep price reduction, but that we could be able to recover those things because of some process improvements, raw material prices, and productivity improvements. Yes, we have been indicating for the last six quarters that we have been working on ARVs that have been resulted in this quarter. Actually, it's sustainable. Yeah. API sales. No. no We're not seeing any. we're not seeing any But Nitin, actually, what happened, actually, we suffered for a few quarters because of the steep price reduction, but that we could be able to recover those things because of some process improvements, raw material prices, and productivity improvements. but nitin actually what happened actually we suffered for a few quarters because of the steep price reduction but that we could be able to recover those things because of some process improvements raw material prices and productivity improvements Yes, we have been indicating for the last six quarters that we have been working on ARVs that have been resulted in this quarter. yes we have been indicating for the last six quarters that we have been working on arvs that have been resulted in this quarter Actually, it's sustainable. actually it's sustainable Yeah. yeah API sales. api sales

Speaker 8: Sir, secondly, on the non-ARV formulation business, what are the growth drivers for this business when you look at next 12-18 months? Sir, secondly, on the non-ARV formulation business, what are the growth drivers for this business when you look at next 12-18 months? sir secondly on the non-arv formulation business what are the growth drivers for this business when you look at next 12-18 months

Speaker 12: We expect to sustain those because of additional capacities coming up for our CMO partner in Europe and also volume gain in the U.S. and also some new launches in North America, both the U.S. and Canada. We expect to sustain those because of additional capacities coming up for our CMO partner in Europe and also volume gain in the U.S. and also some new launches in North America, both the U.S. and Canada. we expect to sustain those because of additional capacities coming up for our cmo partner in europe and also volume gain in the u.s and also some new launches in north america both the u.s and canada

Speaker 8: Okay. And sir, this will, because this quarter was probably the first decent quarter of ramp-up which happened. We had a pretty meaningful ramp-up, actually, this quarter. So is this like a run rate from year on, or there will be lumpiness in this business as we go along? Okay. okay And sir, this will, because this quarter was probably the first decent quarter of ramp-up which happened. and sir this will because this quarter was probably the first decent quarter of ramp-up which happened We had a pretty meaningful ramp-up, actually, this quarter. we had a pretty meaningful ramp-up actually this quarter So is this like a run rate from year on, or there will be lumpiness in this business as we go along? so is this like a run rate from year on or there will be lumpiness in this business as we go along

Speaker 12: I think we expect a little lumpiness, but it is not significant. Yeah. I think we expect a little lumpiness, but it is not significant. i think we expect a little lumpiness but it is not significant Yeah. yeah

Speaker 8: Sir, lastly, on the CDMO business versus the kind of conversations we were having with investors or rather with our partners a couple of years back to the kind of conversations we're beginning to have now, what has been the change? I mean, if you can qualitatively indicate the change in the quality of discussions we are having, scale and scope of discussions we are having with various partners on CDMO? Sir, lastly, on the CDMO business versus the kind of conversations we were having with investors or rather with our partners a couple of years back to the kind of conversations we're beginning to have now, what has been the change? sir lastly on the cdmo business versus the kind of conversations we were having with investors or rather with our partners a couple of years back to the kind of conversations we're beginning to have now what has been the change I mean, if you can qualitatively indicate the change in the quality of discussions we are having, scale and scope of discussions we are having with various partners on CDMO? i mean if you can qualitatively indicate the change in the quality of discussions we are having scale and scope of discussions we are having with various partners on cdmo

Speaker 12: I'm sorry. What answer? Any change in? I'm sorry. i'm sorry What answer? sorry what answer Any change in? any change in

Speaker 5: That's, I mean, it's a long answer. But okay, to just summarize it, I think the tone of the conversations continues to remain the same in terms of what kind of capacities, capabilities, and credentials that the company has. I think that's what primarily attracts customers. With that being said, I think the global landscape has been a tailwind for potential conversations with customers. But the fundamentals need to be sound, and that will only drive the business, is our understanding at least. That's, I mean, it's a long answer. that's i mean it's a long answer But okay, to just summarize it, I think the tone of the conversations continues to remain the same in terms of what kind of capacities, capabilities, and credentials that the company has. but okay to just summarize it i think the tone of the conversations continues to remain the same in terms of what kind of capacities capabilities and credentials that the company has I think that's what primarily attracts customers. i think that's what primarily attracts customers With that being said, I think the global landscape has been a tailwind for potential conversations with customers. with that being said i think the global landscape has been a tailwind for potential conversations with customers But the fundamentals need to be sound, and that will only drive the business, is our understanding at least. but the fundamentals need to be sound and that will only drive the business is our understanding at least

Speaker 8: Okay. Thank you so much. Okay. okay Thank you so much. thank you so much

Speaker 9: Thank you. The next question is from the line of Abhijit K, an individual investor. Please go ahead. Abhijit, please go ahead with your question. Your line is unmuted. Thank you. thank you The next question is from the line of Abhijit K, an individual investor. the next question is from the line of abhijit k an individual investor Please go ahead. please go ahead Abhijit, please go ahead with your question. abhijit please go ahead with your question Your line is unmuted. your line is unmuted

Speaker 20: Yeah. I had a clarification with regards to the CDMO business. You mentioned animal health and crop sciences. Animal health will continue in FY 2027, and crop sciences, one product has been commercialized, and meaningful supply will happen in one to two years. I remember in the previous phone calls, you had mentioned about human health CDMO contract also. Is that still on track, or is there approval spending and etc.? Yeah. yeah I had a clarification with regards to the CDMO business. i had a clarification with regards to the cdmo business You mentioned animal health and crop sciences. you mentioned animal health and crop sciences Animal health will continue in FY 2027, and crop sciences, one product has been commercialized, and meaningful supply will happen in one to two years. animal health will continue in fy 2027 and crop sciences one product has been commercialized and meaningful supply will happen in one to two years I remember in the previous phone calls, you had mentioned about human health CDMO contract also. i remember in the previous phone calls you had mentioned about human health cdmo contract also Is that still on track, or is there approval spending and etc.? is that still on track or is there approval spending and etc

Speaker 12: In the human health space, there are several different programs that we currently work in with several partners. As Dr. K mentioned, there are several commercial supplies ongoing in the human health space. In the human health space, there are several different programs that we currently work in with several partners. in the human health space there are several different programs that we currently work in with several partners As Dr. K mentioned, there are several commercial supplies ongoing in the human health space. as dr k mentioned there are several commercial supplies ongoing in the human health space

Speaker 20: Okay. But percentage-wise, can you give a breakup? Is it possible to say what are you looking more at? Is it crop science, is it animal health, or is the future going to be human health? Because that's where I think a lot of companies are talking about it. So just a picture, if not to be too specific, but just a rough. Okay. okay But percentage-wise, can you give a breakup? but percentage-wise can you give a breakup Is it possible to say what are you looking more at? is it possible to say what are you looking more at Is it crop science, is it animal health, or is the future going to be human health? is it crop science is it animal health or is the future going to be human health Because that's where I think a lot of companies are talking about it. because that's where i think a lot of companies are talking about it So just a picture, if not to be too specific, but just a rough. so just a picture if not to be too specific but just a rough

Speaker 12: Our largest share of CDMO is in the human health space by far, and that will continue to be the case. After that, we have a sizable portion coming in from animal health. And the third one, which is again currently very small, is in the crop science space. And this ranking of human health, animal health, and crop science will be similar if I project a couple of years down the road as well. Our largest share of CDMO is in the human health space by far, and that will continue to be the case. our largest share of cdmo is in the human health space by far and that will continue to be the case After that, we have a sizable portion coming in from animal health. after that we have a sizable portion coming in from animal health And the third one, which is again currently very small, is in the crop science space. and the third one which is again currently very small is in the crop science space And this ranking of human health, animal health, and crop science will be similar if I project a couple of years down the road as well. and this ranking of human health animal health and crop science will be similar if i project a couple of years down the road as well

Speaker 20: Okay. The crop science is the one? Is it a patented product or no? I'm asking this question because next year and in the next two years, a lot of products are going off-patent. I just wanted to understand if it will affect you or not. Okay. okay The crop science is the one? the crop science is the one Is it a patented product or no? is it a patented product or no I'm asking this question because next year and in the next two years, a lot of products are going off-patent. i'm asking this question because next year and in the next two years a lot of products are going off-patent I just wanted to understand if it will affect you or not. i just wanted to understand if it will affect you or not

Speaker 12: Yeah. The commercial one is technically a patented product. Some of the other opportunities that we're working on are also on the patented ones that we're looking at. Yeah. yeah The commercial one is technically a patented product. the commercial one is technically a patented product Some of the other opportunities that we're working on are also on the patented ones that we're looking at. some of the other opportunities that we're working on are also on the patented ones that we're looking at

Speaker 20: Sure. Thank you. Thank you. Sure. sure Thank you. thank you Thank you. thank you

Speaker 9: Thank you. The next question is from the line of Dheeraj Kumar Reddy from EquaSquare. Please go ahead. Thank you. thank you The next question is from the line of Dheeraj Kumar Reddy from EquaSquare. the next question is from the line of dheeraj kumar reddy from equasquare Please go ahead. please go ahead

Speaker 5: Thanks. Thanks for giving me this opportunity. I just have a couple of questions. The first question being, many CDMO players are talking about peptides as an opportunity today. I mean, even Neuland or First Pharma etc., right? They say that this is a $10 billion opportunity. Dr. Chava, I just wanted to understand what out of this $10 billion opportunity, how much will probably come to India, or is it only Indian opportunity? And relevant players will get what kind of market share out of this overall? I mean, you can just give me in a three- to five-year time frame maybe. Yeah. Thanks. thanks Thanks for giving me this opportunity. thanks for giving me this opportunity I just have a couple of questions. i just have a couple of questions The first question being, many CDMO players are talking about peptides as an opportunity today. the first question being many cdmo players are talking about peptides as an opportunity today I mean, even Neuland or First Pharma etc., right? i mean even neuland or first pharma etc right They say that this is a $10 billion opportunity. they say that this is a $10 billion opportunity Dr. Chava, I just wanted to understand what out of this $10 billion opportunity, how much will probably come to India, or is it only Indian opportunity? dr chava i just wanted to understand what out of this $10 billion opportunity how much will probably come to india or is it only indian opportunity And relevant players will get what kind of market share out of this overall? and relevant players will get what kind of market share out of this overall i I mean, you can just give me in a three- to five-year time frame maybe. i mean you can just give me in a three- to five-year time frame maybe Yeah. yeah

Speaker 12: It's a very difficult question to answer. See, we don't have visibility on who is investing, what capacity, what products we have. They have. But whoever gets the GLP opportunity, people are investing in amino acids, protective amino acids, fragments, and some of them investing in small volume, some of them investing large volume. Opportunity is going to be meaningful for a good number of players. And I will not be in a position to comment any further on this. It's a very difficult question to answer. it's a very difficult question to answer See, we don't have visibility on who is investing, what capacity, what products we have. see we don't have visibility on who is investing what capacity what products we have They have. they have But whoever gets the GLP opportunity, people are investing in amino acids, protective amino acids, fragments, and some of them investing in small volume, some of them investing large volume. but whoever gets the glp opportunity people are investing in amino acids protective amino acids fragments and some of them investing in small volume some of them investing large volume Opportunity is going to be meaningful for a good number of players. opportunity is going to be meaningful for a good number of players And I will not be in a position to comment any further on this. and i will not be in a position to comment any further on this

Speaker 3: Got it. And my second question, Dr. Chava, is basically, so if you're saying that ARV will be more or less in the range of INR 2,500 crore-INR 3,000 crore, what is the expected growth in the API segment going forward, API and the formulations? How will they grow in the next two to three years? Got it. got it And my second question, Dr. Chava, is basically, so if you're saying that ARV will be more or less in the range of INR 2,500 crore-INR 3,000 crore, what is the expected growth in the API segment going forward, API and the formulations? and my second question dr chava is basically so if you're saying that arv will be more or less in the range of inr 2,500 crore-inr 3,000 crore what is the expected growth in the api segment going forward api and the formulations How will they grow in the next two to three years? how will they grow in the next two to three years

Speaker 12: We grow in the next year, but significant growth will come in FY 2028 because we're adding capacities where we are getting some generic APIs and formulations. So growth will be significant FY 2028, but there will be some growth in FY 2027 as well. The generic APIs will have their TS space. We grow in the next year, but significant growth will come in FY 2028 because we're adding capacities where we are getting some generic APIs and formulations. we grow in the next year but significant growth will come in fy 2028 because we're adding capacities where we are getting some generic apis and formulations So growth will be significant FY 2028, but there will be some growth in FY 2027 as well. so growth will be significant fy 2028 but there will be some growth in fy 2027 as well The generic APIs will have their TS space. the generic apis will have their ts space

Speaker 3: Understood. Okay. Got it. Got it. Thanks, Dr. Chava. I think that's all from me. Understood. understood Okay. okay Got it. got it Got it. got it Thanks, Dr. Chava. thanks dr chava I think that's all from me. i think that's all from me

Speaker 9: Thank you. Ladies and gentlemen, this will be the last question for today, which is from the line of Mr. Bansal from NBG Investments. Please go ahead. Thank you. thank you Ladies and gentlemen, this will be the last question for today, which is from the line of Mr. Bansal from NBG Investments. ladies and gentlemen this will be the last question for today which is from the line of mr bansal from nbg investments Please go ahead. please go ahead

Speaker 23: Yeah. You said while answering one of the questions from the participant that your asset turnover is 0.9. So what is the maximum achievable capacity sorry, fixed asset turnover ratio? Yeah. yeah You said while answering one of the questions from the participant that your asset turnover is 0.9. you said while answering one of the questions from the participant that your asset turnover is 0.9 So what is the maximum achievable capacity sorry, fixed asset turnover ratio? so what is the maximum achievable capacity sorry fixed asset turnover ratio

Speaker 12: If you look at one of our slides in the investor presentation, our five-year average asset turn was 1.1. Our first target is to reach 1.1. Maybe 0.9 to 1.1, we will reach. But our peak asset turn was 1.4. We are not anticipating 1.4 at this moment, but we are targeting 1.1 over a period of time. If you look at one of our slides in the investor presentation, our five-year average asset turn was 1.1. if you look at one of our slides in the investor presentation our five-year average asset turn was 1.1 Our first target is to reach 1.1. our first target is to reach 1.1 Maybe 0.9 to 1.1, we will reach. maybe 0.9 to 1.1 we will reach But our peak asset turn was 1.4. but our peak asset turn was 1.4 We are not anticipating 1.4 at this moment, but we are targeting 1.1 over a period of time. we are not anticipating 1.4 at this moment but we are targeting 1.1 over a period of time

Speaker 23: Okay. That means you are almost at the full capacity utilization. Okay. okay That means you are almost at the full capacity utilization. that means you are almost at the full capacity utilization

Speaker 12: But 0.9-1.1, actually, there is a we can see it. But 0.9-1.1, actually, there is a we can see it. but 0.9-1.1 actually there is a we can see it

Speaker 23: Correct. Correct. Okay. Okay. Thank you very much. Correct. correct Correct. correct Okay. okay Okay. okay Thank you very much. thank you very much

Speaker 12: Okay. Okay. okay

Speaker 23: Thank you. Thank you. thank you

Speaker 9: Thank you. Ladies and gentlemen, as this was the last question for today, I now hand the conference over to management for closing comments. Thank you. thank you Ladies and gentlemen, as this was the last question for today, I now hand the conference over to management for closing comments. ladies and gentlemen as this was the last question for today i now hand the conference over to management for closing comments

Speaker 12: Thank you, everyone, for asking very insightful questions. Thank you. Thank you, everyone, for asking very insightful questions. thank you everyone for asking very insightful questions Thank you. thank you

Speaker 5: Thank you. Thank you. thank you

Speaker 9: Thank you. On behalf of DAM Capital Advisors Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you. thank you On behalf of DAM Capital Advisors Limited, that concludes this conference. on behalf of dam capital advisors limited 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