Thanks, Anjali. Good evening and warm welcome for second quarter FY '26 earnings call of Alkem Laboratories.

From the management side, we have Mr. Vikas Gupta, CEO; Mr.

Nipin Aggarwal, CFO; and Ms. Purvi Shah, Head of Investor Relations.

Over to you, Purvi.

Good evening, everyone. On behalf of Alkem, we welcome you all to today's Quarter 2 FY '26 results call.

Earlier today, we released our financial results, press release, and results presentation, all of which are available on our website and also have been filed with the stock exchanges. We hope you've had a chance to review them.

Before we begin, please note that this call is being recorded, and the audio transcript will be made available on the exchanges and our website shortly after the call concludes. Also, today's discussion may include certain forward-looking statements, and this should be viewed in the context of the risk and uncertainties associated with our business.

With that, I now hand over the call to our CEO, Dr. Vikas, for his opening remarks.

Over to you, sir.

Thank you so much, Purvi. Very good evening to everyone, and thank you for joining us for our Q2 FY '26 earnings call.

Q2 FY '26 has been another strong quarter for us, marked by robust growth across India, US, and key international markets. We also saw healthy traction in new product launches across our markets.

The GST revision announced by the government during the quarter is a very positive step, and we adapted swiftly to ensure a seamless transition. Our improved gross margins and operating leverage have contributed to a stronger EBITDA profile.

As we look ahead, we remain focused on accelerating growth and continue to strengthen our presence in the key markets. I will now present the key highlights of Q2 FY '26 financial performance.

The total revenue from operations touched an all-time high of ₹40,010 million with a YoY growth of 17.2%. India sales were ₹27,660 million with a YoY growth of 12.4%.

US sales were ₹7,649 million with a YoY growth of 28%. Non-US sales were ₹4,241 million with a YoY growth of 32.4%.

EBITDA grew by 22.3% YoY to ₹9,208 million, resulting in an EBITDA margin of 23%. Net profit after minority interest was ₹7,651 million with a YoY growth of 11.1%.

R&D expenses were at ₹1,302 million, which is 3.3% of our total revenue. According to IQVIA SSA data for Q2 FY '26, in the acute segment in domestic market, Alkem became the number one company.

We outperformed IPM in six therapies out of the total 11. Anti-infectives grew by 1.2x, GI 3.1x, VMN 2.5x, pain 2.3x, and respiratory 1.5x, and derma again, substantially 3.1x of the market.

In the anti-diabetes therapy, if we exclude the GLP-1 launches, we have grown 2x faster than the market. Alkem also ranks number two in the IPM if I take the new product launches in last 12 months.

With a strong foundation firmly in place, we are poised to embrace the opportunities that lie ahead with confidence. I take this opportunity to thank all the teams at Alkem for making this happen, and I wholeheartedly believe in our strategy and remain inspired by the potential the future holds for us.

Thank you so much. With that, we can now open the floor for any questions.

Thanks for taking my question. My first question is on the India business.

We've shown a pretty strong growth in first half. As we look into second half and probably FY '27, do we think Alkem can maintain this growth momentum that we have seen?

What should be the assumption for industry growth and therefore Alkem's growth in the second half and fiscal '27?

Neha, I've always maintained that we will continue to outperform the market at least by 100 to 150 basis points. This growth is backed by one, strong launches, plus our key brands doing pretty fast.

I think this trend can continue even in H2. We gave an overall guidance of a double-digit kind of growth, assuming the market grows at around 8% to 8.5%, which looks like the plausible scenario.

I don't foresee any reason for this growth to slow down even in H2. We should continue showing similar trend in H2.

Of course, Q4 maybe slightly higher than Q3, but overall on an H2 basis, we are confident of continuing this growth trend.

You mentioned 100 to 150 basis points outperformance?

Of the IPM at least.

Okay. On an FY '27, is it fair to assume that we can maintain this outperformance, given the launch and the brand momentum that you're seeing?

Would that be a fair assumption as well?

Yes, sure. India is our core market, and in India, we have really done a lot of strategic initiatives in the last, couple of years, and our growth is really giving us, and we will continue to do whatever is necessary in terms of growing the domestic business, with the similar trend.

Again, I've always maintained that in India, we would always, outperform the market by 100 to 150 basis points. Now, we don't know how the market behaves next year.

We are very confident of our growth as far as domestic market is concerned.

Understood. My second question, sir, on margins, I think we'd guided to flat margins given how first half has been.

Do you think there's an upside risk to that guidance? Or I see that there has been an increase in other expenses.

The new businesses investment that you had planned that is yet to come, and we still maintain the guidance? Any update on the investments in the new businesses as well as the guidance?

Yeah. The new investments that we had spoken about so far have not been fully, operationalized.

In H1, we have hardly seen any expense on that front. In H2, we expect our our US CDMO plant is operational now.

We will get start getting the opex of that plant, from Q3 onwards. In Q3 and Q4, say, H2 put together, we expect at least ₹50 to ₹60 crores as an operational expenditure for H2, per quarter, sorry.

At least ₹100 crores of, operational expenditure that that might start hitting us in H2. The overall guidance, I would say top line, we are confident that, we should be surpassing whatever we had discussed.

Even from the EBITDA guidance perspective, I I see somewhere between 19.5% to 20%, should be our should be our EBITDA for the full year. That's how vis-a-vis, the earlier guidance of keeping it at 19.5%.

I we are hopeful that, we should be looking at that because there is another expense which is going to hit us, not expense, actually, it's an impact because of GST. We had we have an impact of in H2, ₹50 to ₹60 crores, for the benefit that we used to get from the Sikkim facility.

Perhaps that will be another, impact that will be there for us. Put together, I think our H2 expenses will be higher, but still, I would say, we are hopeful of crossing our earlier guidance in spite of these additional expenses, coming in H2.

From 19.5% to 20% is is what we see our, EBITDA numbers. Yeah.

Sorry, sir. One clarification, this ₹50 to ₹60 crores impact from Sikkim facility, this will be on the gross margin line, the benefit that we were getting?

No,

this is accounted under other operating income. It will be part of other revenue.

Okay. Thank you so much.

Understood. Yeah.

Hi. Thank you for the opportunity.

First, can you update us on the sales which came from MedTech and Adroit business in 2Q? Then what kind of spend are currently ongoing for these new businesses?

MedTech, we have just started, we have done almost 900 knee replacements. Though in terms of the revenue, it will be hardly ₹2.5 crores.

In Adroit, I think we are maintaining our run rate of around 15, ₹15 crores for the quarter. That's on Adroit.

In terms of spend, what kind of spend are ongoing for these two segments?

For the quarter, MedTech opex was around ₹8 to ₹9 crores, there is an EBITDA loss of around ₹5.5 crores in MedTech. Adroit is at a break-even, the branded business was already operating.

Alright.

Adroit is at break-even. Is it cost

break-even? It's part of our domestic business, we have never looked at it separate by this thing.

It'll now be merged with our domestic business, we'll run it as a part of the domestic.

Sure, that's helpful. If you can update us on progress in the Enzene business as well.

You mentioned you had started operations in 3Q. What kind of ramp-up timeline you are looking for this business to achieve cost break-even?

I understand you earlier mentioned this facility will incur cost of around ₹50 CR per quarter, right?

Yes. For Enzene US operations, the current average is around ₹15 to ₹20 crores per quarter of revenue, and we expect this to continue till year-end.

We expect to close between ₹70 to ₹80 crores of revenue from Enzene CDMO US business. The opex expense will be around ₹50 crores per quarter going forward, because we just started this facility in the month of September.

Going forward, Q3 and Q4, we expect opex to be around ₹50 crores and revenue to be around ₹20 crores per quarter, because we have just started the plant.

This ₹20 crore revenue is only from the CDMO plant in the US or this is also including the supplies from Pune plant?

No, this is only from US CDMO, yeah.

Okay. How much is the contribution from Pune plant right now?

Pune, around 20, ₹28 crores for the quarter. 20, ₹25 to ₹30 crores for the quarter.

Is this plant cost-neutral now or you are incurring loss there as well?

Domestic is already break-even, or in fact, EBITDA positive. Yeah.

In terms of if you look at overall Pune operations, in H1, we are around ₹180 to ₹185 crores of revenue, including the US business which we do from Pune. For Quarter 2, it was around ₹120 crores from Pune operations, including the business done in US from Pune.

That's helpful. Yeah.

That is under CDMO business from US plant,

yeah. Understood.

Just a question on R&D, my final question. R&D in 1H is much lesser, right?

Earlier, you said 4.5% to 5%. Will you reach there or there is some rethink?

We will. Most of our filings are in Q4, I think it's more of a phasing thing, and we expect the R&D to be within 4% to 5%, and I think we should get there.

That has been our trend over the years, we will catch up. That expense will catch up in H2.

That's helpful. Thank you.

I'll get back in the queue.

Sure, Damayanti.

Hi. Thanks.

Sir, my first question is on penicillin G. We hear that the government is reportedly considering imposing MIP, minimum import price, on penicillin G.

We would love to hear your thoughts, any impact that it could have on us? Could this reverse any benefits that we would have seen?

This is speculative, Bansi, at this point in time, and any hypothesis that I build on this speculation won't hold true. We are waiting for some notification to come.

As of now, we are sufficiently covered in terms of our inventories. Depending on the MIP, whatever price the government will fix, only then we will be able to see whether it is going to be a cost increase or a cost decrease.

That call we can take only when the government fixes the MIP. Otherwise, it is speculative.

I won't be able to comment on it.

Appreciate sir. Second is, ex of R&D, if we look at the other expenses, they've sharply increased sequentially by almost ₹200 crores.

What has driven that?

You're talking about other expenses?

Other expenses.

Mainly on account of our marketing expenses. Generally in Quarter 2, the marketing expenses are highest if you compare to other quarters.

Also there is a slight increase in R&D expense in Quarter 2.

Lastly, sir, just on the non-US growth that has been phenomenal this quarter, 30% plus. Should we expect this momentum to continue?

See,

there are certain markets that have done really well for us as far as the non-US growth is concerned. I have always said that our non-US expectation also will be a high teens kind of growth.

I foresee for this financial year, we should be very much there. At this point in time, maybe because of certain opportunities that we were able to get in markets like Germany and Australia, we have got a very good first half.

We are expecting that looking at even the second half projections, we should be easily upwards or close to around high teens or 20% kind of growth from the non-US markets going forward.

Got it. Thank you, sir.

Yes. Hi, sir.

Congrats for the good set of numbers. Sir, just wanted to understand on the other expense part.

We have seen sharp increase sequentially, and even on year-on-year basis, there is a healthy growth in other expenses. While you mentioned that Enzene-related US expenses will be kicking in from third and fourth quarter, why we are seeing this expenses sequentially and as well as year-on-year in the second quarter?

One reason, as I said, is the marketing expense. Generally, our Quarter 2 marketing expenses are higher as compared to other quarters.

If you compare with last year, it's also we have now two new subsidiaries, Bombay Auto and Adroit, which is currently in this quarter, it was part of the consolidated results. That has also resulted in higher other expenses.

Right. You have mentioned that in second half, we will be doing almost ₹20 crore per quarter from US Enzene plant.

What sort of run rate or annual target we have for the next fiscal for US Enzene?

Bharat, we've always maintained asset turnover of around 1 from the US plant. I think it will take us 12 to 18 months to fully get there.

I think this is just first quarter of when we are operationalizing it. We will try and get to that number, maybe at an annual run rate of 300 crores...

of 300 crores over next 12 to 18 months, that is how we'll fully reach there. I think maybe after a quarter or two, we should be able to give you a better picture on that front.

We're very hopeful of getting there.

Right. Any comments on GLP-1?

How we are positioned for GLP-1 for Indian as well as for other markets in case we have?

I think our India application, our CT for diabetes indication is already completed. We presented to the Subject Expert Committee, and we have got approval that's a public information.

We are waiting for the formal MA to be received. Our results were presented to the Subject Expert Committee.

We are very hopeful that very shortly, we will get the approval for GLP-1. We should be on track and amongst the first players to be out there in India when the patent expires.

With regards to other markets, we are working on launch in other markets as well. Still, the patent goes at different times in different markets.

I think the other markets we will be able to introduce only a couple of years from now. That's the time, and even our US filing will happen it takes 2 years to get the approval.

I think it's a part of our plan as far as other markets are also concerned.

Right. How you are seeing Indian market for us in next year from GLP-1 perspective?

Definitely, we are meaningful player there?

We will be a meaningful player over there. That's what I think we expect whenever we launch a product.

I'm sure everybody would be thinking it's a pretty large opportunity, and I'm sure there is room for a meaningful presence for more than one player in that market.

Got it. Thanks a lot.

I will be back in the queue.

Thank you, Bharat.

Thank you. Congratulations, sir, to the management team for the good set of numbers.

A couple of questions from my side, Gupta sir. First thing, as you highlighted, the domestic growth trend will continue, and FY '27 also, we are confident on the domestic growth part.

In FY '27, '28, also the run rate will improve, and Enzene will start to cross the ₹300 crore annual run rate. Then how should we see the margins from the medium-term perspective from FY '27 onwards?

See, I've always maintained that year on year, we should look at at least a 1% improvement in our overall margins. I think we are pretty much on track for that.

Even if you look at this year, I think that is how it has played out. If I remove the investments behind growth that we have had to do.

I will maintain the similar trend, and we're very hopeful that that's how it should continue.

Okay. In this year, despite having investments, we are expecting around 50 bps margin expansion, and from FY '27 onwards, 1 percentage point margin expansion.

This is a fair understanding, sir?

I spoke about 19.5% to 20% now. Let the year close down, and we will know.

Then, of course, over and above that from subsequent year, we should look at at least a 1% improvement in our overall margins.

Okay. Other question, sir, how are we seeing the season in 3Q?

Seeing the IPM data of October month, it seems that season is still continuing. Any comments on that would be very useful, sir.

Season as in for the

The anti-infectives season generally which we witness in 2Q. Is it still continuing in 3Q as well?

See, seasonality is part and parcel of our business. I don't see any major reason as to why this growth trend shouldn't continue.

I have no speculation here whether season will continue or not, we'll get to see. That's something nobody can predict.

I can tell you, our business is pretty going as per our expectation and going pretty strong. That is something that I can just assure you.

Superb, sir. Thank you, sir.

Thanks.

this will be the ex-US export business. Could you give us a sense around the constant currency growth versus how much was from the constant currency growth in the ex-US market for this quarter?

Constant currency growth in the ex-US market, you're saying, or? See, overall, I think we've had a currency gain of close to 4%...

4 to

4.5%.

in the range of 4% to 4.5%.

Okay. Basically, 32% reported, we should assume 28% was constant currency growth then?

You can assume that. Assume that, yeah.

Got it. Understood.

Then just one more clarification on the margin guidance. Like you said, 100 basis points expansion FY '27 onwards, that includes the impact of some of the investments which you're making in the MedTech and the CDMO business, or that's except for that?

Correct. Whatever investments we have planned as of now, it includes that.

Say, as the business progresses, and if we come across, say, some opportunities where we feel that we should not shy away from making those investments, it's only in that case that we will come back to you. Whatever investments we're planned for now and made for now, well, that is how I think it will play out.

Just to clarify, the increase in opex which we expect, that's part of the guidance already, right, like the 100 basis points expansion?

Yes.

Yes, yeah. Perfect.

Thank you.

Thank you for the opportunity to ask. My question is about the four launches that we have done in the last quarter in the US.

If you can elaborate what kind of launches are these and what is the market size or how much is the competition in these four launches?

I think the most meaningful launch in US has been sacubitril/valsartan that we have done in Q2. That has really done well for us.

That has contributed to the growth in the US market that we have seen this year. Though of course, it's a highly competitive market, let's see how it goes in the subsequent quarters.

I think that should help us to grow the US business this year to the tune of at least maybe a double-digit, from an earlier expectation of close to 5% growth, that mid-single-digit kind of growth that we were expecting from US, we are hopeful that we should be closing the year close to a double-digit kind of growth. I think that's the most meaningful launch that I'll talk about.

Balance launches are there, but at this stage, not so significant that I need to call out the numbers.

Thank you. My second question is about the GST.

Did you experience any impact from the GST either in the top line or the bottom line? How much?

Yeah.

See, GST has been a very welcome move by government, and we clearly believe and appreciate and are very thankful that government has taken that move. I think it's a positive move because the medicines become more affordable, it makes it accessible for more number of patients.

As a company, we are always supportive of such changes. Yes, there were some transient industry-wide disruption that happened with regards to supply chain and with regards to certain costs.

One is a one-time impact that we have had because of our arrangement with the trade that we had to do, which is to the tune of around 10 to ₹10 to ₹12 crores within that range. Second is the benefit that we used to get from Sikkim.

I think that's a substantial impact which is going to hit us from now on. I think that impact in H2 alone is close to around ₹50 to ₹60 crores.

That is the other impact that we have, but we still believe it's a positive move, and we're really appreciative of that.

Thank you very much, and congratulations on the good set of numbers.

Thanks, Karthik.

Thanks for taking my question. Sir, I just had one clarification on the US CDMO revenues.

You're saying is it currently, you're not booking any revenues and from next quarter, it would be ₹20 crores a quarter? Is that what it is, or you're already booking ₹20 crores?

In H1, Saion, we have already booked around 40 to ₹45 crores of revenue from CDMO business in US. Going forward for next two quarters, again, we see around ₹20 crores per quarter of revenue.

As we shared in call just few minutes back that the overall, say, opportunity for us is around ₹300 crores from the current production capacity which we have built, which we estimate to achieve in next 12 to 18 months.

Sir, but the operating cost of ₹50 crores, nothing of that is coming, revenues are booked, but costs are not there in the quarter, ₹50 crore per quarter that you're mentioning?

We just started operations in September. There was some free work which was done for which the revenue was realized.

I think the opex cost was mostly capitalized till September. From next quarter, or from this quarter itself, October to December quarter, there will be an opex cost of around ₹50 crores per quarter from US.

Right. Sir, when you reach that, in another, let's say, 12 to 18 months, a ₹300 crore turnover, then what's the next step?

Are we going to make additional investments? If you can just take us for a slightly medium-term prospect of the CDMO plant in the US?

Saion,

we see a good opportunity in that business. At this stage, because we've just made the plant operational, first, we would like to maximize the output of this plant.

Say 3 to 6 months down the line, if we see an opportunity, and if that warrants us to make and scale up that business and make further investments, we won't shy away, we'll take that call at that stage. At this stage, because in medium term, we are pretty hopeful that that could be a meaningful business for us, the way the opportunity looks like.

Of course, this plant has just got operational, we will see how it's going and how the order book is looking like, and if there is a need to expand, then we will expand.

Is it possible to share how many projects you're working on currently?

We don't give the project-level details, Saion.

Sir. No problem.

Thank you.

Thank you.

Thanks for taking my question. Sir, on the US business, I see that we have tentative approval for tolvaptan.

Is that not a near-term launch for us or is this launch slated for fiscal '27?

No. In tolvaptan, you're talking about the Jynarque, JIRNAQC approval, right?

Yeah.

That is slated for FY '27. We'll be launching at that time because we have an ongoing litigation with the innovator.

We will take that call. At this stage, it's a little far away.

Understood. For mirabegron, it would be based on the litigation outcome for the existing generic players in Feb, so that could still be an

option? No, like I have clarified earlier, I think we have a settlement agreement with the innovator.

We will launch only after the patent expires.

Okay. Thank you so much.

Hi. Thank you for the opportunity.

Just two questions. Firstly, on the gross margin.

Like in Q1 also, with strong domestic business growth, we have seen 65% gross 65.3% gross margin. In the current quarter, with India business and along with all the geographies, we have been seeing double-digit growth, but gross margins are still at 65%.

Is there anything to read between that, anything that missing out?

The gross margin is a factor of two, three things. One is your API prices, definitely, we saw decline in API prices in Quarter 2 as compared to Quarter 1 or as compared to the corresponding quarter of last year.

Our international business growth was higher than domestic in Quarter 2, and whenever international business will grow at a higher rate than domestic, there will be impact on gross margin, because our gross margin for domestic business is better than international. That was one of the reasons that you don't see great improvement in gross margin quarter-on-quarter.

Okay. I think 64% 63.5%, 64% gross margin is something that we can look forward for the second half and for the full year?

Yeah, 64% to 65% you can, yeah.

Okay. Sir, and just lastly on your US business.

Given that, like you also highlighted that the sacubitril is a very competitive space, how has been the pricing erosion in that, and what can we expect for the next quarter in that product?

See, price erosion in a new launch in US is a market phenomenon. Right?

This is only first quarter of players entering. If the question is whether price erosion will happen, price erosion will happen.

When it starts tracking, whether it is 3 months from now, 6 months from now, we'll wait and see. I'm sure, in any new launches, when more and more players come in that market, the price erosion starts happening in US market.

There is one level of price erosion that has already happened, and we will see how the market evolves. I think we will be fairly competitive in that segment.

Thank you, sir. That's it from my side.

Thanks for the opportunity. This is Rashmi Shetty.

Just again on the US part. When you say that this quarter will be largely benefited from valsartan, sacubitril, and CDMO, if I remove that part, quarter-on-quarter, is the base stable, or we have seen some erosion on a quarter-on-quarter basis?

See, if we remove the new launches, the general trend has been very flattish for the US business. We have volume growth, but there is price erosion that happens, which is the nature of that market.

The growth is largely driven by the new launches.

Okay. How many launches have we done in first half?

I think we've done four launches. The meaningful one was sacubitril/valsartan.

Correct. How many are we planning for second half?

I think at this stage, we will have at least three, three or four more.

Three and four, okay. When you say that for this full year, we will be doing double-digit growth, would it be high teens growth or a lower double-digit growth in the US market?

I think close to tend a low double-digit kind of growth, somewhere between 10%, 10% to 11% is what I expect. We should be close to

Assuming that the erosion will hit in sacubitril/valsartan?

In the subsequent quarters when the price erosion happens in these new launches, so that's how we are looking at.

Okay. One more question on other intangible assets.

When I just compare seeing in your balance sheet from 31st March '25 to the current second half, it has gone significantly up. If you can specify the reason for that?

See,

we acquired two companies in April '25. One was Bombay Auto and the other was Adroit.

Other intangible assets also includes the trademark and the technical know-how which we got from these companies when we acquired them. We have capitalized the trademark and technical know-how from these two companies, and that is the reason the other intangible assets have gone up, and also there is some impact on the depreciation and amortization amount.

Okay. Some impact is also there in the goodwill, right?

Yes.

Some part,

yes.

Okay. Thank you so much.

That's it from my side.

Thank you.

Hi, sir. This is Abdul from ICICI Securities.

Sir, just one question on the overheads and how should we see the ramp-up at the new CDMO plant? I understand you've been guiding about ₹50 crores of operating overheads, but then by when is the plant expected to break even?

12 to 18 months. It has just started operational in this quarter, and within 12 to 18 months, we should be reaching the break-even.

Okay. Sir, what would be the timeline for your MedTech ventures?

See, MedTech, operationally, if you look at, we will break even from the current operations, but we will like to also invest in and go for other markets through this product. There will be some expenses on product filings and also on getting, say, other countries' approval for the factory.

I think FY '28 is when we will break even, but the amount will be not very significant from MedTech in terms of opex losses.

Got it. Sir, one final one, if I may, on the M&A front.

In terms of our key priority markets, in India, we continuously now still looking for acquiring some brands on the domestic formulation side, or MedTech is something where the focus is now shifting across to?

No, it's not like that. I think India is our core market, and I've always said that we're continuously on the lookout.

Now we have good cash on our balance sheet as well. Whenever there is a right opportunity at the right value where we feel that we can create more value, we'll go for it.

That's our take.

Got it, sir. Thank you, and wish you all the best.

Thank you.

Thanks for the opportunity. Sir, just on the Enzene side, what to be taken as a gross margin, Enzene US or maybe Enzene combined US as well as Pune site?

See, CDMO business is generally a higher margin than our overall corporate margins. That's how I can say.

It's a high gross margin business, right, generally. I don't think margins are a consideration in that business, and that's why we are very confident about that opportunity.

I think the right way to look at it is the EBITDA margin, because you don't incur much of material cost when you do CDMO, yeah, and it is

Because this are more because of the CDMO work at the product development level or this would be more like a commercial level?

No, for development, yeah. For US, as of now, yeah, for product development, yeah.

When we are thinking of reaching the ₹300 crore asset, ₹300 crore sales as well, that is largely to be coming from development block?

It is all development work. This is not a commercial scale manufacturing.

Understood, sir. Just one clarification, the GST impact of ₹50 to ₹60 crores you were highlighting, that is per quarter or for second half?

No, that is in H2. At a quarter level, that's around ₹25 to ₹30 crores.

Got it. Lastly, now how much to take ETR or effective tax rate for FY '27,

'28? FY '27 will be 35% to 38%, you can say, because we'll be coming out of MAT after March '26.

Anything which is probably not any losses which will not be considered and which is why this 35% to 38%?

There is always some amount of expenses which get disallowed under income tax, so that is why the rate is more than 35%. Yes, we have more than ₹1,500 crores of MAT credit on our balance sheet, for next, say, 1 or 2 years, we will not have any cash outflow much.

It will be under MAT only, the cash outflow, but yeah, the ETR will increase significantly as compared to what we have today.

Just lastly, additional opex with respect to CDMO plant, ₹50 to ₹60 crore per quarter in terms of expenses, GST impact for the second half completely, and on the MedTech side, additional opex?

MedTech, see, current opex is in the range of ₹10 to ₹12 crores only. Going forward, I don't see any major significant increase.

Maybe in the range of, say, it may increase further by ₹7 to ₹8 crores max. Just to give you in terms of guidance, I think there is a lot of query related to the other expense.

Other expense, there is a significant increase from Quarter 1 to Quarter 2. The other expense will be for Quarter 3 and Quarter 4, it will be in the range of, say, ₹900, ₹905 crores.

Everything, including Enzene and MedTech, our other expenses will be around ₹900 crores for Quarter 3 and Quarter 4.

Got it, sir. Thank you.

That's it from my side.

Thank you all for joining today's call and for your questions. If you still have any follow-up queries and need any clarification, please feel free to reach out to us directly.

Thank you.

Thank you. Thank you, everyone.