Thank you, Sagar. Good afternoon and welcome to Cipla's Q4 FY26 earnings call.

I am Diksha Maheshwari from the Investor Relations team at Cipla. Let me draw your attention to the fact that on this call, our discussion will include certain forward-looking statements, which are predictions, projections, or other estimates about future events.

These estimates reflect management's current expectations of the future performance of the company. Please note that these estimates involve several risks and uncertainties that could cause our actual results to differ materially from what is expressed or implied.

Cipla does not undertake any obligation to publicly update any forward-looking statement, whether as a result of new confirmations, future events, or otherwise. I hope you have received the investor presentation that we have posted on our website.

I would like to request Achin to begin.

Thank you, Diksha. Good afternoon, everyone, and thank you for joining us for our fourth quarter earnings call for financial year 2026.

2026 was a year of milestones for us. We completed our 90th anniversary for the business, and we achieved significant milestones across all of our businesses: One India, North America, One Africa, and EMU.

In India, we crossed a significant threshold with the business surpassing ₹12,500 crores in revenues, underscoring the strength and resilience of our domestic franchise, which is our largest franchise. In North America, the successful generic Ventolin approval from our US facility marked an important strategic inflection point and reinforced our R&D capabilities.

Our One Africa business continued to deliver market-beating growth, and our EMU operations scaled meaningfully to become a $400 million plus business unit. Together, these achievements highlight our disciplined execution and our commitment to sustainable as well as diversified growth across geographies.

Now let me touch upon the individual businesses. Our One India business delivered a robust performance this quarter, growing at 15% year-on-year, driven by strong double-digit growth across branded prescription, trade generics, as well as consumer health.

Full-year growth stands at 9% YoY. On the branded prescription business, our key chronic therapies: respiratory, antidiabetics, cardiac, and urology delivered a strong double-digit market growth.

Our chronic mix stands at 60% as per IQVIA MAT March '26. Foracort, our leading inhalation brand, surpassed a revenue of ₹1,000 crores, reaffirming its position as a respiratory market leader.

Meanwhile, Dytor, our cardiac brand, has established itself as a 600 as a ₹650 crore brand, delivering 25% YoY growth. This year, we expanded our presence in the IPM by adding four brands with revenues exceeding ₹100 crores, bringing the total to 33 such brands.

Our footprint in the top 300 brands in the industry now has 23 such brands. This year, our growth has also been helped by a series of successful differentiated product launches across the core therapies.

In respiratory, we launched products into the inhalation franchise, including Foracort G Synchrobreathe, Ciphailer, and the triple combination Voltido Trio, which are strengthening adherence while delivering therapeutic benefits. In antimicrobial resistance, we launched Zemdri, Cipenmet, S-Plosef, which underlines our presence and leadership in resistant and critical infections and AMR.

In urology, we launched a novel product called Frictor, which expands our leadership in non-antibiotic management of recurrent UTIs. In our diabetes franchise, we launched SGLT2-led portfolio, including empagliflozin.

In dermatology, we launched an innovative solution, Perfecscar, for scar management. Together, these launches reflect our execution strength.

It reflects our focus on complexity and our commitment to driving sustainable growth through improved patient outcomes. During the year, we also enhanced our pipeline and portfolio through strategic partnerships.

We entered into a collaboration with Eli Lilly for Yopik, making our entry into the fast-growing obesity segment with a best-in-class molecule. Our partnership with MannKind Corporation of US brought Afrezza, India's first rapid-acting inhaled insulin, reinforcing our focus on differentiated diabetes solutions.

We also gained exclusive rights to Pfizer's key established brands, further strengthening our access to strong brands in the IPM. Additionally, the acquisition of Inscripta Healthcare enhanced our portfolio on pediatric and wellness products side.

Put together, these efforts meaningfully enhanced our portfolio and reinforced Cipla's long-term growth ambitions. On trade generic side, we continued the strong growth momentum, delivering double-digit growth YoY for the quarter as well as for FY26.

This performance was driven by focused execution across distribution, a robust pipeline of strategic new product launches, and meaningful advancements in technology-enabled operations. We will continue to expand portfolio and use that as a key driver for growth, with 70 new launches planned this year.

Our consumer health business continued its strong upward growth trajectory, with Nicotex, Omnigel, and Cipladine consolidating their number one positions in the respective segments. The business is driving very healthy secondary growth and actively exploring opportunities to invest in products and channels to further expand our distribution network.

Operating profitability has improved in CHL, reflecting the strength and scalability of our consumer health strategy. Coming to North America, the business reported quarterly revenue of $155 million US dollars and an annual revenue of $780 million, supported by demand in our differentiated portfolio and a steady base business.

Albuterol market share increased to 19.6% as per IQVIA MAT March '26. During the year, we advanced our portfolio with several key assets, including liraglutide, nintedanib, and dapagliflozin.

Notably, we received regulatory approval for the first AB-rated generic Ventolin with CGT, representing the first commercial MDI product to be manufactured from our US facility. This milestone reinforces our growing confidence and capability to deliver complex generics not just from India, but also from our US manufacturing facility.

We are expecting to launch this product within the coming month. Our Goa facility, together with two US facilities, is well equipped to support the launch of all four respiratory assets planned for FY27, enabling a seamless and well-coordinated supply to the market.

Our One Africa business grew at an impressive 14% year-on-year growth rate during the quarter, with a full-year growth of 7% YoY in USD terms, powered by firm performance across key markets. In the private market, our secondary growth outpaced the market growth with 6.6% versus 4.8% for the market.

In EMU, our focused strategy on deep penetration has built a strong foundation, enabling the business to breach the $400 million US revenue mark. This is despite the significant volatility that has been happening in the recent months because of the war.

The business remained resilient during the quarter, navigating geopolitical uncertainty and disruptions with strength and discipline. It was led both by DTM and B2B categories, alongside consistent margin stability and internal pipeline assets.

On the regulatory front, during the year, US FDA conducted and concluded inspections at three of our manufacturing facilities in India: Bommasandra in Bangalore, Sai Tech at Mumbai, and Medispray in Goa, all of these inspections resulting in a VAI or NAI classification. This accomplishment reflects our sturdy dedication to quality, compliance, and operational excellence.

A quick update on our US pipeline: we continue to prioritize organic investments with sustained focus on advancing R&D capabilities for the US market in particular. We remain very confident in our US business outlook, which is supported by a pipeline of nearly 40 to 50 products to be filed over the next three years.

This includes 12 first-to-files and eight FT2 opportunities that we're targeting. In the respiratory portfolio, five assets have been filed, including the generic Ventolin.

Four of these are expected to be commercialized in FY27. We are also going to deepen this pipeline with four additional respiratory assets scheduled for filing over the next 24 months.

Importantly, we remain committed to sustainability and innovation, with two respiratory assets incorporating green propellants expected to be filed over the next 24 months as well. In peptides and complex generics, eight assets are already filed, with select launches projected between FY27 and '28.

We aim to file three more peptides and complex generic assets in the next 12 to 24 months. Additionally, we are working on oligonucleotides, and we're also having two global biosimilar assets: one is undergoing clinical study under an IND, and the other is in earlier stage of development.

We see biosimilars as a very large and under-penetrated opportunity, and with the recent change in some of the guidelines, we believe this to be an upcoming, almost $200 billion opportunity with around 100 such biologics expected to lose exclusivity over the next decade. We are going to enhance our efforts on biosimilars.

We have a JV with Kemwell, which is focused on execution, which has an initial pipeline of respiratory assets and oncology assets. We are looking at adding at least one to two assets on in-house biosimilar development through this JV, which will really build our presence in the biosimilar space over the next 5 to 7 years.

On the back of these ambitions and with a very solid foundation of execution, we are also accelerating our AI-led transformation. Our strength has always been on execution across quality, manufacturing, and regulatory.

With the AI transformation, we aim to become a leading AI-led pharma organization. We have invested in robust data and technology foundations, which allows us to scale this up in a structured and sustainable way, and also in a very timely fashion.

We will be focusing a lot on driving efficiency, productivity, and better decision-making with the help of AI over the coming months to coming year. I would now like to invite Ashish to present the financial and operational performance.

Thank you, Achin. I'd like to present the key financial highlights for the quarter and the financial year.

We reported a quarterly revenue of ₹6,541 crore, and as a result of that, we ended the year with ₹28,163 crore. The EBITDA margins for the quarter stood at 15.2% and 21% for the year.

Like every time, this does not include other income. The gross margin after material costs stood at 65.6% for the quarter and 66% for the full year.

This was primarily driven by the product mix in the revenue. Total expenses for the quarter include employee costs and other expenses, which stood at ₹3,296 crore.

This was higher by about 10% YoY. Annually, the expenses were ₹12,689 crore, which was again a similar percentage increase YoY.

The increase in employee cost reflects our planned investments in talent, both to support our markets as well as to strengthen our manufacturing readiness in both India as well as in the US. Overall, the operating expenses also include continued investment in R&D, which stood at ₹509 crore, which is at about 7.8% of the revenue for the quarter.

For the year, it was ₹1,974 crore, which is at about 7% of the revenue. These investments are aligned with our pipeline priorities.

It enables our new launches, and it builds readiness for the upcoming products. As a result, we are scaling up our annual filings like it has been highlighted by Achin.

In addition, we have started to see some impact of ongoing geopolitical situation within the operating expenses, which we are closely monitoring. In the near quarters, we don't see much a meaningful impact, but in the future quarters, as the revenue inventory gets consumed, you'll see that impact coming through.

For the quarter, PAT stood at ₹555 crore, representing 8.5% of sales, with an effective tax rate of 22.2%. On the full-year basis, the PAT amounts to ₹3,879 crore, accounting to 13.8% of sales, while the ETR for the year is 25.9%.

Our ROCE stood at 22.9% for the year. Of course, PAT also assumes a certain impairment that we've had during this quarter.

Our free cash flow generation and operating efficiency endures to drive healthy net cash position. As of 31st March 2026, the debt on our balance sheet, including the lease liabilities, stood at ₹614 crore, with net cash equivalent balance at ₹10,526 crore.

Looking ahead, I think the key priorities will include: for One India, it could be to focus on execution to sustain the growth momentum and to outperform the market in branded generic, trade generic, as well as in consumer wellness. We will further strengthen our presence in chronic therapies, including diabetes, cardiology, urology, and dermatology, while maintaining the robust strength trajectory that we've built in respiratory.

In North America, we will concentrate on enhancing our commercial execution and accelerating new product introductions. Our aim is to cross $1 billion mark as a run rate towards the end of this financial year, i.e., FY27.

In South Africa, our focus will be on improving the private mix with correction in tender contribution. In EMU, our top priority is to drive top-line growth by deepening penetration in core markets while maintaining a strong margin trajectory.

Looking ahead to FY27, supported by a ramp-up of new launches and investments that we've made across our manufacturing facilities, and ongoing expense optimization initiatives, we expect the EBITDA margins to be in the range of 18.5% to 20%. This would be actually achieved with a sequential improvement quarter-on-quarter, with the key improvement being in the second half of the year.

On an overall basis, you'll have 18.5% to 20% kind of a range. This guidance does not include any contribution from lanreotide in FY27.

I'd like to thank you for your attention and will revert back to the moderator to open up for the questions and answers. Sir,

Sure, please.

Hi, good evening and thanks for the opportunity. During the quarter, did we kind of book any shelf stock adjustment for Revlimid?

No, I think we had shared this in the last quarter as well. We did not have any SSA adjustments.

Okay. Second, on generic Ventolin launch that you are expected to do next month, just wanted to understand if the innovator is supposed to launch a green version of Ventolin sometime by third quarter of this financial year.

Hypothetically, if the innovator is able to replace all of their Ventolin product with the new version, would that impact Cipla?

Right now generic to the existing Ventolin. The switching to another variant is, I think that will be a process which is not an automatic process under the US law at this point of time.

We do not anticipate any near-term impact of that change as and when the transition starts to happen.

Okay. If you could update on the respiratory pipeline, the key assets Advair, Symbicort, QVAR, Flovent?

I think as we have guided, we were expecting four approvals this year. Ventolin has already got approved.

We are having different goal dates for different products. During the year, we are expecting Advair, Symbicort, and then one other asset to get approved.

This will happen during I think H1, and one is H2 as well.

Okay. What is holding back Advair for so long?

I think your question is probably more historic. If you recall, we had OAI at our Indore facility.

We had to tech transfer to the US, which caused the delay. Now we're ready with everything.

It's just a matter of receiving the approval.

Just one final one Right, sorry.

Just to complete, we went through a pre-approval inspection on our US facility for this particular product.

Got it. Just one final one.

Do you expect to see any benefit out of the EU FTA for your respiratory portfolio because you source a lot of the basic devices from Europe?

At this point, we are not expecting any meaningful impact of that. I think it's more business as usual at this point in time.

Is there a change in the duty structure there or it remains the same pre and post EU FTA?

It remains the same, there is no benefit as such. In EU, we are already selling respiratory devices which are in-house, there's no significant benefit that we see coming from EU FTA.

My question was more from a sourcing standpoint. The key raw materials that come from Europe, would they be cheaper for you?

No so, we get some raw materials from there, especially on the devices side, but there's no any such benefit that we have out there.

Okay. Thank you.

Hi, thanks for the opportunity. Just wanted to understand the specific initiatives around AI which you mentioned.

If you could share any specific initiatives that you've taken and any other pilot initiatives that you see scaling up in future? Yes.

AI is a broad-based implementation that we're targeting, which will focus across multiple functions. The difference between what used to happen in the past versus now is we're focusing on end-to-end processes versus small limited use cases.

We have implementations across quality, regulatory, corporate functions, and a lot of the R&D-related use cases as well. The idea is to use it in a way that helps obviously faster and better decision-making, but also ultimately gives us productivity benefits.

Right. On the biosimilars front, just wanted to understand in terms of your strategy for biosimilars, are you looking at in-licensing or are you looking at your own development, and what sort of a pipeline and timeline are you looking at for that, both from a US and EU perspective?

Is that sort of accelerated given the new FDA draft guidelines?

Yes. We have predominantly an in-house strategy, where we have two assets currently under development for developed markets.

One of them is already under clinical trials under an IND of US. We will be adding one to two assets each year, which will then therefore start resulting into a pipeline of six to eight in-house assets over the next 5 to 8 years.

On top of that, we are considering limited amount of in-licensing, where there are near-term opportunities that are not within our in-house portfolio. For those, we are open to considering some in-licensing opportunities as well.

We see this as a newer space, more so because of the changes to the guidelines, which have placed us in a good position, where we can run these like the other complex projects, and we can benefit from the overall economics of developing these projects. Understood.

Thank you so much.

Thank you for this opportunity, sir. My first question is on the US revenue guidance what you are talking about, about a billion dollars by the end of this year.

Sir, if and also simultaneously you have mentioned that in your guidance for '27, you have not factored lanreotide. That means in your expectation for FY26, you are not considering lanreotide, and obviously this lenalidomide is not there.

If we kind of deduct these two product revenue from the $780 million annualized revenue of FY26 for US, the number what you are talking about is almost double the size of base US business of FY26. What is the kind of bridge that we are talking about, where from this revenue build-up that will happen?

Can you give some clarity, sir? Yeah.

The guidance, I just wanted to clarify, is a billion-dollar run rate by the end of the year. We are not guiding for a billion-dollar revenue during the year, right?

The reason for that is because a lot of this is contingent on pipeline maturing. We have one approval already in hand.

As we've mentioned, there are three other respiratory approvals. There's one big peptide approval and there are three other products which have already got approved in the year, smaller assets, etc.

As these products get approved, our run rate will keep improving and we will get to that billion dollar by the end of FY27, which puts us in a very good position because historically, we were shy of that, we would want to see the year ending at a good run rate of billion in the US.

Okay. That means kind of in the second half, we will see a run rate of almost $100 million incremental revenue versus the quarterly run rate in the first half.

Yeah.

Okay. Now, since you have mentioned that lanreotide you have not factored while guiding for the margin for the year, what is the outlook that we are giving for lanreotide for this year and for the subsequent period, given the kind of total disruption that we are currently seeing for that molecule?

Yeah. For lanreotide, we have the partner who is working on the remediation effort.

That's in full swing and we're helping them as much as possible on navigating that path. I think maybe by next quarter, we'll have closer visibility on their exact remediation timelines, which will also include a reinspection from US FDA.

That we can come back and guide after a quarter. In parallel, we have also identified alternate supplier for this.

Alternate manufacturing site, which will be based out of the US. The objective is to be able to file by early next year next calendar year, also Q4 of this financial year.

That gives us a two-pronged approach to overcome this. I think, it will it will come back.

It's a very interesting opportunity, being a long-acting injectable. Once we are able to resolve either of these two, and now we have two shots at goal, we will be back in this.

Definitely from an FY28 perspective, it will be.

Sure, sir. On Ventolin, that is the next question.

We already mentioned that we have around 22% kind of or more than 20% kind of market share in the albuterol market itself in the US. Now with another variant of albuterol is getting approved, do you find any changes to the kind of market dynamic in terms of the pricing or in terms of the competition, or in terms of your scope in albuterol as a whole, whether it will lead to incremental business or not, since it is a variant of albuterol only, and the prescription would be based on albuterol HFA, that way?

Yeah. No, these are different products because they get substituted to the different innovator products.

It's a different NDC, different market. We have CGT on the generic Ventolin, we will actually be exclusive for six-month period.

We expect a significant uptake. There is no cannibalization that will happen on the other variant, which is a generic to another variant of the molecule.

We're more likely to take the share from the existing Ventolin suppliers rather than go in eat from the other franchise.

Okay. Just last one question from my side, sir.

Is there any scope of rationalization on the cost front, see because if the revenue is likely to slide on the US front particularly, are we likely to see any reduction in any cost line item for FY27?

Look, there are two parts. We are working on number of productivity enhancement measures, which will help us optimize the cost, including some of the tech-related transformation that we spoke about.

The short term, there are disruptions because of the war situation on sourcing side. Right now we're having visibility to what we've seen so far, but if it prolongs, that's something that is still yet to be quantified.

To answer your question on basic efficiencies and productivity, yes, we're working on that, and it will materialize as we go through during the year. There's one more point which I think you should keep in mind is we had invested in our North America facilities for these complex products, and so far the cost has been there in the last quarter or two, but the revenues have not commensurately come.

We will see that corresponding revenue with the new launches, and therefore the economies of scale will improve as we go along.

Sure, sir. Thank you.

Wish you all the best.

Thanks for the opportunity. Just on the R&D, connecting R&D spend overall almost ₹2,000 crores, but at the same time, very few ANDAs being filed.

Is it that the R&D spend for ANDA is significantly higher maybe for FY26, '25 compared to the earlier let's say the philosophy of R&D spend for ANDA? That's my first question.

Yes, actually we have gone after products including some first-to-files which are on oligonucleotide side as well. We've gone into more respiratory, more peptide, and more oligo, which is resulting in higher spend per filing.

Some of these also involve litigation cost as well. That also leads to higher R&D spend.

It has got everything in that R&D spend that you see, both API cost, your R&Ds that you buy, litigation, etc., etc. Of course, some of these oligonucleotides, etc., we go outside to CROs, CMOs as well.

There is also cost involved in that.

Typically, at least without getting into product-specific details, but let's say for respiratory and oligo products, per ANDA R&D spend, broad number you would like to call out?

I think that's very case-specific, it's difficult to call out an average number. We are guiding towards 7%-ish on R&D spend as a percentage of sales, and I think in the mix, the mix will also change slightly in the coming year, because as I said, 40 to 50 filings with respiratory, with first-to-files, and certain number of peptides, etc.

Hard to put a metric on per filing, because the nature of that filing changes a little bit. Our endeavor is to go after complex opportunities, which keeps the business sustainable, and NPV per project has to be high, right?

That's the internal criteria.

Got it, sir. Secondly, the albuterol market share has sort of reduced quarter-on-quarter, while the number was at 19.5%, then it moved up to 22%, and we are now back to 19.5%.

Anything to read through in that? No,

I think it's hardly reduction that you see out there of 0.4% or so that we've seen. I think 19% to 20%, or rather 19.5% to 20% is something that you should pencil in.

We are rank one out there, and if you could supply more, then there's a potential to increase our share as well.

Just to complete on the R&D part, is this Indore site regulatory issue also one of the reason for let's say delay in filing because of the regulatory issue at Indore site or that Indore site classification has got nothing to do with the filing of the assets?

No, now we have de-risked out of Indore. Our assets are filed from US and one of the assets we are doing from Goa because Goa is cleared.

No, I was referring to let's say prospective filing, not the ones which are already cleared. Let's say where we do R&D spend, where the product probably from a validation or exhibit batches are ready, but because of classification at Indore site the acceptance of filing by US FDA, is there that kind of a delay also happening?

See, likewise for potential filings also, we're focusing more on Goa and US site. Indore, I think we will accelerate as soon as it clears, yeah.

Got it, sir. Just lastly, on Ventolin, this product will see a gradual pickup in terms of market share?

What's your strategy if you could highlight, while we have exclusivity, but would the pickup be gradual enough or we can have a sizeable business in say two to three quarters' timeline?

You will see towards second half a ramp-up happening in generic Ventolin. Though we will launch it within the quarter one, and quarter one, yeah, and but but the ramp-up will happen in half two.

Capacity won't be a constraint for this product?

No, we have US facility for it.

From the device combination as well, perspective?

From which, sorry? Come again.

From the drug device, while drug would be there from

Oh yeah, there's not a problem at all on the devices side.

Got it, sir. Thanks a lot for

Devices

Thanks a lot, sir. Thanks.

Hi, thank you for the opportunity. My question is again on your US exit guidance of 1 billion in FY27.

You indicated a couple of interesting products in respiratory, peptides, etc., which can help you to achieve this rate. My two questions there: what kind of visibility you have on these products, which gives you confidence that you can receive approval in this year?

Second is for some of the bigger assets, what kind of risk mitigation strategies which you have already implemented, if you can elaborate on these two points? Thank you.

No, see, I think in terms of confidence in each of these assets, we are seeing some developments happening. Like for example, in Advair, now you've had a PAI that has happened.

Okay. Ventolin, where we were expecting around the same time, we've got the approval.

In certain other assets also, there is an ongoing discussion, readiness that is there. Of course, we can't anticipate when the approval will come through, but in some of them, we are aware of the goal date, etc., which helps us well for quarter three, quarter four ramp-up to happen to a billion-dollar kind of a run rate.

That's what we have envisaged in our business plan. From facility point of view, all these facilities are also de-risked.

From internally, it's only pending approval. From internally, we are ready to kind of launch these assets as soon as the approval comes.

Sure. When you say facilities issues are de-risked, most of these filings are filed from two sites, say one from India and one from US, is that the case?

No, that won't be the case. Right now these are filed from US, or from Goa you'll have one or two assets filed.

These are respiratory that I'm talking about. The peptide is with a partner site outside.

Progressively we don't anticipate any risk in the facility. Goa has recently got inspected as well.

There are two observation. We've responded to those observations.

We're waiting for the classification. Can't comment on that.

Nevertheless, that's the status of our facilities, yeah.

Sure. My second question is on your India business.

Obviously, fourth quarter I believe is very strong and full year you ended at 9% growth for the segment. When we look ahead, say '27, '28, do you think you can outpace IPM growth in say next one or two years or it might take slightly longer, because say market growth also improved in recent time, we are seeing around low double-digit growth for market.

On that perspective, you're just close by, but not outpacing the market as of now?

Yes, we are confident that we'd be able to deliver a strong double-digit growth as well as a market-beating growth in FY27, '28. We've been seeing that consistent trend over the last couple of quarters.

You think it's possible. Okay.

My last question is on your gross margin trends, if qualitatively you can give some color, given now your product pipeline is becoming more complex generics heavy. In that sense, how should we look at your gross margins in say near term or in medium term?

See, it's a large mix bag in the gross margin, there are many factors that go into it. In the last quarter, I had highlighted that we had R&D cost, material cost going up, due to which the gross margin had got impacted.

Some bit of that has got reversed in this quarter, where the margin is better because also, not just the product mix, but also because the R&D material cost was lower in comparison to the previous quarter that you saw. I think the way I look at it is that, of course, lenalidomide was a high-margin product, but most of our respi assets that are coming are mostly in-house products.

In-house products will always give you a higher end of the margin more than the company average that you're seeing today. It'll only accretive to your company gross margin.

At the same time, some of the peptides that we're talking about and oligo, oligo is much later, but peptides that we're talking about, they are partnered products. While the gross margin could be high out there, but there is also a profit share as a royalty that we end up paying, which goes into gross to net.

Therefore, your gross margin in those products will be after the profit share, which kind of brings it down. At the same time, the S&D etc.

in the US at least is not much, it is accretive significantly to your EBITDA margin. In India, we are moving more and more towards chronic.

Chronic will definitely come with a 5% to 10% better gross margin, and we are keeping a very tight control on what ILDs we do. Keeping all these things in mind, I think gross margin should have a positive bias.

The last thing that I just want to highlight is that generally, you'll see in the results also, there's a strong controls that we have over COGS. Every year, we take some target to actually reduce the COGS such that is lesser than the revenue growth that you see out there.

I think these are the things that we take care of. Of course, there is this whole geopolitical and war risk that is there.

We had some impact of that in quarter four. We have some impact in quarter one, not significant though, but some of this inventory that we're buying today, as it gets consumed in second half, there may be some cost, but that's temporary.

I think your question was more around longer-term sustainable. Longer term, I've talked about, but there may be some blips here and there because of the reason that I mentioned.

Sure. Thank you very much for your response.

All the best.

Hi, good afternoon. Sorry to be harping on the US guidance.

One clarification, when you're saying that you will be at a billion-dollar exit run rate, does it include lanreotide or it doesn't include any contribution from lanreotide?

At the moment, we've left that out of this guidance. That will be an upside to plan if we can successfully get back in the market before that.

Okay. If I annualize this quarter's US revenue, you are at around $620 million.

We are talking about a billion-dollar exit, this is about $380 million of incremental revenue. Just wanted to understand the skewness of this $380 million.

There are, I think, six, seven products that you're launching this year. What kind of contribution will be from one or two products in this incremental revenue?

Will it be a skew towards one or two products or can there be an equitable distribution among six, seven products? Because I'm just asking so that it doesn't create a big risk in FY28 because if competition comes in, then again you kind of face a situation which you've faced in Revlimid this year.

Nikhil, in terms of annualized revenues from these products, I think couple of them, we are expecting $100 million plus annualized opportunities, right? The others are also significant, right?

Then this is respiratory, and then there's a peptide asset which is also big. We are expecting big contributions.

I think the reason we're not able to give a quarter-wise kind of breakup or a product-wise breakup is because the timing of launch, if it moves one or two months, that affects the full-year number. Run-rate-wise, assuming we have these launches, we will be able to cross that run rate by the end of the year.

There are two, three big opportunities and a couple of medium-sized opportunities.

Got it. What kind of a tail are we looking at in these plus $100 million opportunities?

Can they continue for let's say a couple of years, 2028 and 2029, or in '28 onwards only we can see some bit of erosion starting to happen?

See, these are not like the six-month exclusivity kind of opportunities. Even if competition enters, they will taper off slowly, right?

The way to look at it is what you saw in our albuterol or what you saw on our lanreotide prior to supply disruption issues. These are more steady opportunities, where we have to manage some level of price erosion, but not a cliff kind of scenario, right?

These are steady opportunities. If there is a price erosion with new competition coming in, you may see some volume going up, we'll have to manage it as a dollar value rather than looking at it as volume or a price game.

Understood. On the India business, can you quantify the contribution from Yopik in 4Q?

I imagine it's only 4Q where Yopik would have contributed, not in 3Q, right?

It wasn't that large because real sales started happening in Jan. Jan, Feb, March, we've seen growth internally and secondaries.

April also we saw an improvement over March on secondaries, but yeah, out of the 15% overall One India we've reported, it's not going to be a meaningful percentage.

Sub-1%, is that the sub-1 or sub-2%, is that how we should read it? See,

I think those figures are broadly available in the market. If you look at IQVIA, it will give you a direction of how much primarily we are doing.

Okay. Is there any M&A component or in-licensing component that I might have missed which is also leading to this double-digit growth in 4Q?

Yes, we had in-licensing of some Pfizer products, and we had a small acquisition of a business called Inscripta.

Okay. Yeah.

The base will still be double-digit. I think the presentation also we had mentioned, I think the four or last time on we've always announced these table for ILDs and acquisitions that we've made.

Understood. Thank you so much.

Hi. Thanks for taking my question.

Achin, over the next let's say 2, 3 years, how should we think about your capital deployment both let's say organically or inorganically? If you can give any color, the kind of assets and capabilities that you're looking at?

Yeah. Look, I think we are preparing for a solid growth over the next 5 years and beyond, and for that, I think the number one deployment is going to be on R&D side.

We have plans to accelerate R&D pipeline for respiratory assets. We have some under approval, more which we are filing.

Complex products which we outlined for peptides, other differentiated products. Also we're going to step up on biosimilar side, where we would want to do roughly six to eight internally, and if we find a couple of good opportunities, we can supplement through inorganic as well, so that will consume some capital.

Then we have CapEx, which we have increased steadily over the last 3 years. This cycle will probably reduce after another year or so, because we've built enough capacity for the products that we want to supply, and beyond that, we will be led more by productivity initiatives.

On top of that, inorganic, we are interested in looking at assets. We evaluate several assets.

Our bias is more towards differentiated, specialty kind of products for developed markets, which is US and Europe, which give us a more sustainable growth and some capabilities as well. I think those are the areas where we would want to deploy capital in order to sustain the entire trajectory over a longer period of time.

Anything in India or emerging markets, like more in branded generic space you think Cipla would be looking at, or this would be largely organically built?

India, we've actually put a slide in investor deck on the partnerships we've done. A large acquisition in India is little difficult for us because we are a number two, number three player.

We are actually number one by volume, whenever we start looking at some of these, there's a significant overlap that we have to account for. Emerging markets remains a very good opportunity for us.

We're looking at that. If we find opportunities where we get business plus capabilities, that would excite us a little bit more, because then that gives us a platform for future growth as well.

Right. Achin, just one clarification.

The cash on balance sheet is pretty large now, and the kind of expansion organically and inorganic opportunity, it appears that it won't get consumed. Are we then thinking about high dividend payout?

What are your thoughts on the cash that you have on your books now?

As I said, see there are opportunities to deploy. We need to be selective.

When we look at it as in absolute rupee terms, it looks high, but if you were to chase one or two large transactions, meaningful transactions, this is not a very high amount of cash. I don't think we are worried about the cash on our books.

It gives us flexibility and it gives us opportunities to look at options which can help the future growth of the organization. At the same time, we do remain selective because of the kind of opportunities that we're looking at have to really pass all our filters in terms of diligence and adding strategic value.

Right. Thanks and all the best.

Thank you.

Thanks for taking my question. A quick question on the India business.

I think you mentioned we grew double-digit in the trade generic business, and I see we are growing double-digit in consumer healthcare as well, in FY26. Is it fair that the branded generic business has actually been pretty muted for the entire year?

Therefore, what gives us confidence that we'll be able to beat India growth in the next year?

I think we mentioned that all the three segments of the business have done really well in especially Q3 and Q4. Q1 we had a muted quarter on the branded Rx business, but that is behind us now, right?

There were reasons related to seasonality, etc., but we've not seen those similar reasons as we've started this particular financial year. With the products we have and the strategies that are there, we are quite confident and we've seen that trend now over at least a two quarters, which gives us confidence that this will continue.

Also we should still acknowledge that acute is a fair representation in our mix in comparison to other players and market. That is season dependent.

Last couple of years, we've had challenging season. We have to work much harder in other part of our portfolio to achieve that growth, which at least we've been able to do in the second half of the year.

In that case, given that we've had a fairly low base on seasonality, ideally even a normal season should give you that tailwind for India growth this year, right? That would be a fair assumption, even a normal season should help it.

That's why we're saying we're confident about a double-digit growth because these seasonal patterns don't happen too many years in a row, right? I think the base was low for last year on some of these acute things, but also the chronic portion, particularly diabetes, cardiology has grown significantly.

We've also diversified beyond that seasonality-dependent portfolio. Yes, we will overcome this.

Okay. My second question is on the margin guidance that we mentioned, 18.5% to 20%.

Given that a lot of the, US growth will be second the high-value launches would be second-half weighted, is it fair to assume that in the second half, our margins could be north of the 20% range and therefore the average that you've given, would that be a fair assumption?

That's exactly what I had mentioned initially that in 18.5% to 20% that we're guiding, it will be more in the favor of H2, where you'll have better than average. First two quarters where we don't have the benefit of new launches, we will see a lower margin than the average that we're giving.

That's the trend that you will see.

Thanks for the opportunity. I am just again trying to understand your EBITDA margin guidance given the outlook you provided for the US business $1 billion plus run rate and India double-digit growth in FY27.

This 18.5% to 20% appear a bit conservative. Just trying to understand, have you baked in significant impact of, let's say, input cost increase or impact of geopolitical situation, etc., or anything that is holding you back from giving a better guidance?

Thank you. Look,

see, I think we have made a lot of investment in the last 1 or 2 years, both on people as well as on R&D, okay? Both these costs is going to sustain.

People cost will continue to be high because we've made in manufacturing facilities, leaders, and to add to reports, etc. I think more or less that investment phase is coming to an end.

Of course, that people cost is now sitting with us, and revenue of that will start coming in, like Achin had said later, with the new launches coming in. R&D also, while it is discretionary and in and hand, but still will continue to be at about 6% to 7%, but more biased towards 7% because we are increasing the number of programs, etc.

Therefore, I think 18.5% to 20% is a fair margin to assume. We are baking in more moderate kind of a war risk, and we're hoping that it's temporary and not really going to sustain.

If it sustains, then of course, this margin, we'll still try to mitigate through other measures, but nevertheless, we're not factored in a very long-term kind of a sustained impact of that. Understood.

Given that you are suggesting 2H margins to be better than 1H and it will factor new launches in the US, is it fair to understand that 28 margins, or FY28 margins can be materially different or better than FY27? I think

that would be our target, right? We will obviously work towards continue to improve our targeted margin.

To be fair, I think it should 20% plus something that we should anyway sustain going forward.

Last question on one product, nintedanib. How material this product can be?

Is it a very short-term opportunity for 2, 3 months, or it can last throughout this year? If you can help us understand.

Thank you.

It's not a very large product, but we've got good market share, it's doing well for us. We've had a few other launches as well already in the year, but I would not call them out separately.

They're not of that magnitude.

Thank you, everyone, for joining in. If you have any further questions, please write it to [email protected].

Thank you.