Thank you, moderator. A very good morning to all of you and thank you for joining us today for Indegene's earnings conference call for the first quarter of financial year 2027.

Today we have with us Mr. Manish Gupta, Indegene's Chairman and CEO, and Mr.

Suhas Prabhu, CFO, to share the highlights of the business and financials of the quarter. I hope you have gone through our results release and the investor presentation, which have been uploaded on the website as well as the stock exchange website.

The transcript of this call will be available in a week's time on the company's website. Please know that today's discussion will be forward-looking in nature and must be viewed in relation to the risks pertaining to our business.

At the end of this call, in case you have any further questions, please feel free to reach out with the investor relations team. Over to Manish.

Thank you, Abhishek. Good morning, everyone, and thank you for joining our Q1 FY27 earnings call.

Given that we are already midway through 2026, it is a good moment to take stock both of how our industry is doing and the start we have made to the year. Let me begin with the industry, then turn to our performance, our deal momentum, and I also want to continue to talk about what makes Indegene structurally different as well as the outlook for the year.

Let's start with the industry. The global pharma industry continues to show resilient growth in 2026, expanding in the mid to high single digits year-on-year through the first half of the year.

Notably, the top 20 global pharma companies, who are the core of our customer base, are outpacing that average with cumulative revenue growth of roughly 10% to 12% year-on-year in the first calendar quarter. These companies are expected to stay ahead of the broader industry.

While anti-obesity remains the primary growth driver, what standout is the breadth of momentum. High-value therapeutic categories such as immunology, oncology, and mental health are all growing in double digits.

Most large pharma companies deliver strong first-half results, though outcome varied by portfolio mix. 8 of the top 20 25 biopharms posted double-digit revenue growth in the first calendar.

Only a handful, those with heavy loss of exclusivity exposure or waning COVID-19 sales, saw decline. Smaller biotechs had a more mixed first half.

Funding in biotech and IPO conditions remained selective, but an uptick in partnerships and M&A provided relief with big pharma spending over $100 billion on biopharm acquisitions in the first half, on pace for the largest deal since 2019 as companies buy pipeline to address patent cliffs. The outlook for the second half and beyond remains constructive, with analysts projecting sustained mid single-digit pharma growth through 2027.

Now let's look at the regulatory front. There are no major items of note this quarter.

The industry continues to navigate pricing pressure, loss of exclusivity through a two-pronged response. First, several mega brands facing material loss of exclusivity risks are reimagining their marketing spends to maximize portfolio economics, a trend that benefits us directly.

The $10 million-plus omnichannel marketing deal, which we had won in Q3 and spoken about, is a clear example of that. Second, the drug pipeline remains near historic highs as the industry shifts towards advancing multiple candidates rather than betting on a single blockbuster.

This is a multi-year trend and its effect is that pharma will need far more efficient ways to run commercial operations across wider portfolios with lower peak sales per asset. A key enabler for this we believe is going to be AI, which is already compressing timelines and lowering the cost of advancing candidate.

Each of these forces plays to Indegene's strengths. With this broad background, now let me turn to our own performance and let me be direct.

We have started the year well. Q1 revenues came in at INR 10,631 million, growing 39.7% year-on-year and 6% quarter-on-quarter.

This is the strongest first-quarter quarter-on-quarter growth we have delivered in a first quarter in 4 years. We see this as a base on which we will continue to build momentum.

This growth is broad-based, not a one-off. Importantly, it was led by accounts beyond our top 20, which now contribute more than a third of our total revenues.

Our active client base crossed the milestone of 100, reaching 105, and we have added 2 customers to the $10 to $25 million bucket, taking that cohort to 9. Our revenue per employee, something which we've been alluding to in all our calls, now is approximately $77,000 on a trailing 12-month basis.

This remains industry-leading, a direct reflection of the quality of our engagements and the productivity of our model. A word on demand environment.

Across our conversations, customers are genuinely excited about the potential of AI. Where they are ready to move, that excitement is translating to real expanding work.

What we are also seeing is that while the enthusiasm is real, enterprise adoption remains measured and the pace of change on the ground is slower. Now we at Indegene view this as an opportunity rather than a concern, and let me tell you why.

Our large tectonic engagement, which we had spoken about earlier in Germany we announced this in Q4 illustrates the dynamic well. While offtake on the existing scope has been measured, the customer confidence was strong enough that they expanded into a further region during the quarter, and I'm going to speak about this in the deal wins.

This we believe is typical in new technology adoption cycles, and it is precisely the environment in which a partner that can understand the domain, engineer trust, and can operationalize AI at scale wins. With that, let me come to deal wins and the FY27 momentum.

We had a robust quarter on deal wins in Enterprise Commercial segment. We signed 1 deal in the $3 to $5 million range, where a top 5 customer selected us to migrate the content platform.

We also signed 4 deals with annual contracts in the $1 to $3 million range, 3 in commercial and 1 in medical. The first one is the extension of the tectonic engagement, I just spoke about this, in Germany.

Now this is our largest customer. That Germany engagement has now expanded to Spain.

A top 20 pharma company chose us to support its brands across the US for creative and digital production using omnichannel assets. Another biotech company engaged us to enable its content platform end-to-end, from assessment and maturity through build and migrations.

In medical, a biotech company brought us in for medical writing, this is going to be for submissions. Beyond these, we won a couple of deals in the sub-million-dollar bracket.

The reason we bring these, that while these are modest today, these are the first phase of larger engagements with the potential to grow into multimillion-dollar relationships: one with a mid-sized European company supporting launch readiness with scope to extend into data analytics, and another where a top 20 pharma company selected us for a change management consulting assignment with the potential to set up a global content factory for their international business unit. We're very excited about this one.

I also wanted to highlight two offerings that are gaining strong traction. The first is agentic KOL.

Building on the proof of concept we completed with a multinational pharmaceutical company, and we spoke about this earlier in our I think Q4 earnings call, we are now in advanced discussions to close the next phase of that engagement. Now if we step back and see, together agentic KOL and tectonic, which we spoke about earlier, demonstrates the direction we are taking as a company, moving upstream and capturing a larger share of the value chain.

We're winning high-value work in how customers conceive, plan, and build their commercial and medical activities. From a strong base in running content operations, which we had for a very long period of time, and omnichannel campaigns at scale, we are bringing in upstream capabilities in brand strategy, creative, as the same accountable partner.

Our organic and inorganic capability investments over the past 4 years, combined with our technology investments in content super app agents and our proven ability to run global commercial operations at scale creates a truly differentiated proposition. The second offering, which we see traction on, is our regulatory one-click submission.

We spoke about this, the engagement with a mid-sized pharma company, which continues to expand in scope, taking on new reports, and is becoming a blueprint for the industry. We continue scaling our homegrown platforms: medico-legal review and medical writing, where our domain expertise is embedded in technology and these are central to delivering an output rather than headcount.

Taking together, none of this is a one-off. The deals we signed this quarter and the offerings I've just described are repeatable capabilities, ones we can take to every one of our customers.

It is this repeatability on top of a strong and consistent pipeline that gives us the confidence to say that FY27 will be a stronger year than FY26. With this, let me step back and reiterate something more fundamental, why we stay confident quarter-on-quarter.

Whatever the environment, it is because Indegene is structurally different. I spoke about this in Q4, I want to speak about it again a bit today.

We are a new category of a company, not a better version of any old one. Many of you have asked how to benchmark us: as IT services, agency, or a CRO.

None of these molds fit. Four things set us apart, and we together call them the Indegene EDGE, and EDGE as in E-D-G-E: E for embedded revenue partner, D for deep domain expertise, G is GenAI disruptor, and E is the engagement model.

Let me talk about each one of them. Let's talk about embedded revenue partner.

We work inside our client's revenue engine: the commercial and medical functions behind launches, growth, and brands. Our buyers are focused on growth, ROI, and compliance.

This is where we differ from any IT company. Any IT vendor sits on the cost side of the budget, bought by the technology organization and measured on efficiency and arbitrage, and is therefore exposed to cost-cutting.

We sit on the other side: commercial budgets tied to the products clients most want to grow. This we believe still is an underappreciated point.

Even the savings we deliver through productivity and AI do not vanish as our client's margins; they are redeployed as more volume, more personalized content, and more channels, which return to us as more work. We win either way and we are far more resilient to cost-cutting than a typical services model.

Now let's come to the second one, deep domain expertise built over 27 years in life sciences, with more than 29% of our people from a healthcare background. The real asset is not headcount; it is domain knowledge beneath it, embedded in our client's workflows over decades.

Our work is critical, judgment-intensive, and heavily regulated. It needs human judgment and AI together, and it is far less susceptible to automation than coding or any infrastructure.

Every new technology, GenAI included, compounds on that hard-won knowledge. AI is an accelerant for us; we don't believe it's a threat.

Third, we ourselves have been a GenAI disruptor. GenAI reshapes our economics on two fronts: on demand side, clients face exploding complexity, rising content volumes, heavier compliance burdens across fragmented brand-by-brand, market-by-market models, which pushes them to centralize.

We meet that at the enterprise level, re-engineering entire end-to-end processes rather than selling point solutions, and taking wallet share from incumbents, which are typically agencies and CROs as I spoke about earlier. On economics, GenAI is driving price deflation.

Incumbents at very large scale lack the growth headroom to offset for falling prices; we are the opposite, large enough to serve global clients end-to-end, nimble enough to convert deflation into new volumes and share gains. GenAI is a tailwind, as I spoke about earlier.

The very technology that erodes incumbents' economics expands ours and opens client budgets that were closed to us even a few quarters back. The last and very important one, engagement model.

Our engagement model for years, and I would have spoken about this even when we were doing IPO, were built around outputs and outcomes, not headcount. Most of our revenue is outcome-aligned, paid for work delivered and value created, not bodies deployed.

Priced on outputs, every efficiency gain flows straight to our bottom line, giving us a structural incentive to adopt new technology faster than peers and to keep the upside rather than pass it through. Reinforcing this is a single integrated global delivery model, unlike much of the agency world, which is scattered and local.

This gives us scale and consistency that brand-level players simply cannot match. Now none of this is new.

You've heard it before. I've returned to it today because, in a journey of a company and a changing environment, these are exactly the things that do not change: embedded in revenue, deep domain expertise, a GenAI disruptor, and an outcome-aligned engagement model.

That is the Indegene EDGE. That's why our confidence rests not on a single quarter, but on the durability of this business over a long horizon.

Now, over that long horizon I spoke about, the impact of Indegene EDGE shows up in numbers. I just want to take a step back.

It's been 2 years since we listed. Now in this period, we prioritized gaining market share and continued to build on our competitive differentiators by building proprietary GenAI platforms, investing in GTM, and making strategic acquisitions.

We set out to grow on two fronts at once: widening our client base and deepening our largest relationships, with growth being our priority. We delivered.

Our total revenue is up 57% from Q1 FY25, that's the time when we had listed. On the widening, specifically, our active client base has grown from 65 to 105, million-dollar-plus clients from 36 to 54, and revenue from accounts beyond the top 20 has become more than 2 and a half times.

This is not a top-heavy business riding on a few names; it's broadening and it's broadening fast. As we move upstream in our client's value chain into higher-value work, this growth has come with rising quality and not rising headcount.

Revenue per employee grew 25% in last 2 years to over 70,000 $77,000 US dollars. The share of delivery talent with healthcare expertise has risen to 29% from 22%.

Our cash position has strengthened by over 30% in the same period. Growth, breadth, depth of expertise, and financial strength all at once and all compounding.

This is what business delivers when you give it time. The deepening of top accounts is still ahead of us, as our largest clients have not yet shown up in these numbers.

The intent, opportunity, and momentum is there. The evidence of the depth is sitting in our pipelines today, and we are confident it'll convert into revenue soon.

This confidence is grounded in the Indegene EDGE. The same embedded, outcome-aligned, domain-led model that widened our base is what will deepen these relationships and continue to disrupt incumbents.

When it does, it lands on top of everything I've just described. With that, let me hand over to Suhas, who'll take you through the financials for the quarter and how we see the margin trajectory also playing out.

Suhas, over to you.

Thank you, Manish. Once again, a very good morning to all and we appreciate your participation on the call today.

Let me take you through the financial performance for the quarter in more detail. Revenues for the quarter came in at ₹10,631 million or US$112.5 million, representing growth of 26.5% year-on-year and 2.5% quarter-on-quarter in US dollar terms.

Let me turn to margins. Our EBITDA for the quarter was ₹1,795 million at a margin of 16.9%.

On a reported basis, that is 50 basis points higher quarter-on-quarter. As you will recall, the prior quarter carried an adverse impact of roughly 240 basis points from the mark-to-market of undesignated forward contracts ahead of us adopting hedge accounting due to Forex volatility, and adjusting for that impact in the past quarter, our margins declined sequentially.

Two factors caused this. First, we have invested in workforce transformation that had a one-time impact on margins this quarter, but will have a long-term impact in reducing our employee cost as well as tempering the impact of wage hikes going forward.

Second, we carried the cost of contracted tectonic and certain GenAI engagements, where the revenue contribution is still building slowly. Manish mentioned this earlier.

As this reverses with revenues from these engagements coming through and the favorable impact of workforce transformation is realized, both these factors will largely offset the impact from the annual wage hike cycle in our second quarter, Q2, thereby keeping our margins stable, unlike the declining Q2 EBITDA margin that we have historically trended. Moving down the P&L, PBT came in at ₹1,527 million, up 45.3% sequentially.

The effective tax rate for the quarter, tad below 24% at 23.9%, PAT grew 45.9% sequentially to ₹1,162 million at 10.9%, up approximately 300 basis points sequentially. On the segments and geographical mix, the mix was stable.

Enterprise Commercial, our largest segment, contributed 70.6% of revenue, and North America, our largest geography, 75.1%. On the customer side, revenues from accounts beyond our top 20 has almost doubled year-on-year in rupee terms and now contributes 33.4% of total revenue.

As a result, the share from our largest cohorts declined even as those cohorts continued to grow in absolute terms, a healthy diversification. Our active customer count rose sharply, up 14 sequentially to 105, a direct result of the sales and go-to-market investments we made last year.

We continue to engage these customers through our land-and-expand strategy. Finally, the DSOs net of unearned and unbilled revenue was 67 days, up 4 days quarter-on-quarter, and our cash and cash equivalents combined with investments remained strong at ₹14,602 million.

Before I close, let me spend a moment on margins going forward and the expected trajectory for the rest of FY27. First, I will refer to our August 2025 earnings call in which we highlighted investments in go-to-market and technology impacting margins by 150 basis points starting Q3 of fiscal year '26, with a 6- to 8-quarter period for normalization.

With the current and anticipated momentum in FY27, we are on track and the margin normalization is expected in 6 quarters, that is by Q4 of FY27. Second, the ramp-up of signed deals through the year, and most notably the outcome-based omnichannel engagement we won in the third quarter of FY26 with one of our top customers.

We have been carrying that cost of engagement since it went live in Q4 of FY26, and with revenue expected to be recognized starting Q3 of FY27, it adds to our H2 revenues with costs already being incurred in the P&L. Hence, most of that revenue will flow straight to the bottom line.

Finally, productivity benefits from workforce transformation and other GenAI-led initiatives across operations and support functions, the impact of which will keep widening progressively. We reiterate the trajectory that we set out in October last year, which is a recovery to the margin band we have historically operated in.

Through the inflection point in Q3 of FY27, the EBITDA in H2 FY27 will be back in the range that we have operated in the past, that is 19% to 20%. Nothing we have seen in this quarter changes that expectation, and if anything, our conviction that we are on track for this has increased.

With that, let me pass it back to Manish for the outlook.

Thank you, Suhas. Let me close with a few words on how we see the year ahead.

We have started FY27 on a strong note. As I said earlier, our best first-quarter sequential growth in 4 years.

With the broadening client base and well-qualified pipeline, on that basis, we expect our organic growth in FY27 to be better than FY26 and we anticipate an acceleration in the second half. As discussed over recent quarters, we have made deliberate, ahead-of-the-curve investments in our go-to-market engine and capabilities that compressed margins near-term, a conscious choice to capture the opportunities now showing up in the numbers I just walked through.

Our priority now is twofold: first, deepen existing relationships and convert the pipeline, including in our largest clients, into signed deals and revenue; and the second priority is bring margins back to the levels we historically operated, Suhas spoke about that. H2 of this fiscal year is when we believe both these priorities will start coming together.

The outcome-based omnichannel engagement begins contributing from Q3, aiding both growth and profitability, alongside our other deal wins scaling more meaningfully. If you add the productivity initiatives we have in, we expect the margin recovery to become clearly visible to you.

Stepping back, the industry is growing. The large enterprises at the heart of it are growing faster still.

AI is a structural tailwind to our model and we are the partner best-positioned to help the industry move from promise of AI to performance at scale. That is the Indegene EDGE, and it is why we enter the rest of FY27 not merely optimistic, but genuinely confident.

With that, we can open the floor for questions. Back to you, moderator.

Hello, am I audible?

Yeah. Manish and team, just two broad questions I have.

What is the current quarter's organic revenue growth

Good morning to the team. I have two questions.

My first question to Mr. Gupta is just want to understand beyond the regular outlook, what are the top two to three execution priorities you are focusing on in the coming quarters?

Alongside that, what do you see as the biggest risk in client adoption, regulatory shifts or compliance or competitive pressure, and how are you preparing to manage them while strengthening Indegene's position in the healthcare solutions and digital transformation? That's my first question.

I'll ask my second question after this. Thank you.

Okay.

Let me take a step back. At a broader level, continuing to execute on our GTM engine, and I mentioned both deepening our client relationships, as I've said earlier, our priorities is to convert, move the whole customer pyramid, right, get into our first $50 million accounts, move more accounts to 25.

That is a priority which we've been speaking about, continues to be there. The second is of course continue to expand our customer base, which is on track.

If I take a slightly-term view, we continue to invest in our capabilities and tech stack, building end-to-end solutions for our clients to adopt AI much more meaningfully, right, and when I say meaningfully, drive outcomes rather than just provide some point solutions. That's what we continue to focus on.

I would say this is probably the more long-term trend. If we step back and if you step back and look at the current-quarter priorities, it is essentially focused on, as I said, making sure that the pipeline we have gets converted into revenues, and we have a decent pipeline, including with our largest customers.

We get that converted. The other one is getting our margin profile back, right, keeping tight control on that.

The reason we are confident about that is this is not resting on some revenue which we'll win in the future, right. This is resting on revenue which we will in all probability be recognizing, right, contracts which we already have.

That's what gives us confidence. Suhas, you want to add on to this, please?

Sucrit, you also spoke about the risks. What we keep a look out for is the regulatory environment and the policy decisions, especially in the US, which impacts this industry the most.

Having said that, currently the policy outlook is stable. The drug pricing and the MFN related decisions are largely behind this industry, and the new launch pipeline is very healthy and robust.

Having said that, that's one thing that we are constantly on the lookout for.

Thank you. My second question to Mr.

Suhas is from a financial point of view, just want to understand what key risks or challenges do you anticipate in the coming quarters? What specific measures have been taken to manage margins, cash flow, and strengthen the balance sheet, especially in areas like client receivables, compliance, or currency volatility?

Thank you.

You start with the last one probably.

Yes. Coming to the currency volatility, we have in the last quarter moved our accounting to the designated hedge accounting as per the accounting standards.

Therefore, volatility due to mark-to-market if there are sudden movements in the dollar-rupee or other currencies that we see will no longer be impacting us going forward. Of course, the current undesignated hedges, which will still be material through till December of this year, is the only thing that we have to look out for from an accounting perspective.

We continue to hedge as we have in the past, and therefore we believe that the margins, the stability given the currency volatility, will not impact us at a operating margin level going forward. Coming back to the risks on receivables and cash flow management, most of our business, more than 90%, comes from not just the top 20 pharma, which are probably Fortune 500, Fortune 1000 kind of company, but also mid-tier pharma companies, which are multi-billion-dollar companies with very strong balance sheets.

Credit risk has not been a significant part of our risk profile in the past. We rarely see receivable risks, and we have very minimal provisions or bad debt write-offs even if I go back 27 years in our history.

Having said that, we have a strong governance process and innovative deal structures in our commercial terms when we engage with biotech and emerging pharma, where the risk profile could be slightly different from the traditional ones. One other thing that we are looking out for is the performance on our outcome-based model contracts, which we have been operating for a very long time.

In the current age of evolving GenAI needs is also getting the customer involved, getting the sign-offs, and interim markers being ticked off as we move deeper on those engagements. I would say that the cash flow and receivable risk is not a significant one amongst these three.

Hi, Manish and Suhas. Thank you so much for giving me the opportunity.

I have just one question and I want to start with the clarification on the margins, right? While you mentioned H2 should normalize, but in the same opening statement you mentioned Q4 should see some normalization of the margin back to our pre-investment levels.

Is there any delay there, right? That's clarification on that.

More importantly, Manish, right, would you just help us understand the nature of this expenses, right, while you talk about the investment, right, in a way, but what gives us confidence that this is in true sense investment and not something that we need to continue in a ever-changing world, right, in a way? Given an option, some of the expenses, would you want to capitalize because they are going to add long-term value to us, barring how the accounting works, that's a different story.

Just to understand the nature of this expenses, could you give us some instances where these expenses are leading to long-term relationship or strengthening of relationship of our customer or adding more mote to our business, and hence the nature of the expenses is more like an investment rather than a P&L expenses per se?

Sure. Let me break this up and I'll give you a bit of a trajectory.

I think the first time when we came and communicated that we're going to take a hit in margin was in October 2025, which was our Q2 earnings call for the financial year FY25-26, right? Before we took the hit, we came out and said we're going to take this hit.

That time what we had seen is the nature of our conversation with our clients were changing. They were much more strategic in nature, right.

Our tech stacks and capabilities were coming together and we needed capabilities in the front at a very different scale, right. We had a bunch of people in various areas: our commercial business, our medical business, consulting, technology, and a lot of them were on site, right, in US and Europe.

That's a hit we were taking. That is what we had called out as the first hit.

That time, what we said is that we're taking this hit, however we believe in 6 to 8 quarters, which is the end of this financial year, right, or if you do add the 6 to 8 from October 2025, it is end of this financial year or the first half of the next financial year. That's a broad range we had given.

Your first question, is there any delay? What Suhas alluded to, no, there is no delay.

In fact, what we said is 6 to 8, we had bought a range over there. We're saying we don't need this range, it's not going to be 6 to 8, it's going to be 6.

Right, by March-end we get back to that 19% to 20% range. That was one piece.

Now on the second thing is outside of these investments, we've won some very strategic deals, right, and those deals is where we have invested heavily on, and the revenues still have to flow in, right, for those deals, and they will flow in. That's what we're talking about, the second half on this year.

These are with some of our largest customers, super strategic deals, which we believe have the potential to kind of define the industry, right. I spoke about tectonic in the past, right, that's a place where we're moving upstream.

The second one where we're investing heavily on is a deal where we are managing an entire portfolio of brands for a pharma company, right, in the United States. More than $1 billion worth of products have been given to us and we are the partner which is managing physician outreach, and hence the prescription uptake.

Those are the kind of deals which we have done, which we invested in, and the revenue visibility to us in the second half is I would say pretty decent on these deals. Suhas, you want to add on anything to this?

Maybe just to reiterate, if I was not clear, what we had indicated was that it would be absorbed and therefore get normalized, these investments, in 6 to 8 quarters. What we are calling now is that we have strong confidence that we would be able to get there in 6 quarters, which means by the Q4 of this year, 6 quarters from when we made those investments.

The last one, if we come back, is with the capitalization piece you spoke about. We continue to invest heavily in our tech stack, right.

This is our prop tech stack. We continue to invest in that.

I would say we've ratcheted up the investments a bit over there because we're investing in a data layer where we have our own data, right, where we're integrating with various data sources. Cortex, something which I've spoken about, which is the context layer, which we are building on top of that apps, and then on top of that skills, workflows for our clients.

As a practice, we've been expensing these out, right. Technically, there's a case to be built over there on capitalization, but we'll continue to expense these out to keep our P&L and balance sheet clean.

Thank you so much, Manish. What I understand, and just to correct me if I'm wrong, what you are saying is that you will reach that target of margin in 6 quarters, and this is despite the fact that you have won large deals and you have invested in it, right?

Is that a fair summary?

But 6 quarters was from October 2025. It's no longer 6 quarters from here.

It'd be

3 quarters now. Correct.

This is despite the fact that you have invested in some of the large deals, right, which maybe you did not factor it in when you gave this guidance. Is that fair?

Absolutely.

Hi, thank you for taking my question. A couple of things.

One is what was the organic growth this quarter and how much was from BioPharma? If you can give that breakup, that'll be good.

We are not breaking up organic and inorganic growth from a BioPharma perspective anymore. We gave it for 2 quarters because right now, given the kind of deals that is coming in, right, I would say BioPharma is reasonably well-integrated, right, into our thing.

It's very difficult to peel that out, that what was BioPharma, what was anything else.

Okay.

Suhas, you want to

Sequentially, both are in the base.

Both are in the base on a sequence perspective.

Okay. What was the CC, constant currency, growth for this quarter?

I can't find that number in the presentation.

Vinay, we disclose US dollar growth, given that about 84%, 85% of our revenues are in US dollar, but if I do a quick approximation given that we also have euro and GBP, which are the next two significant currencies, it will be a tad north of our US dollar growth of 2.5%, will be more in the 2.6% to 2.7% range.

Thanks for the opportunity. Two questions from my end.

You talked about some outcome-based things getting executed. As we plan to data mine our customers and scale the business, what is the percentage we are looking at these outcome-based deals?

Is that going to be the norm for the industry and us as we plan to scale? Because everybody wants the proof of the pudding and then people want to scale.

Is that trend happening for us and the industry? Secondly, you mentioned about second half being better in terms of margin recovery and some of the cost have already been incurred.

Typically, on a historic basis, there is an order book and execution cycle. If you could delve deeper for us to understand how does revenue and order book and visibility flow in so that some of the initiatives which you talk can flow to the P&L.

Those are my two questions. Thanks.

Let me talk about the outcome and output things and pass it on to Suhas. As a company, we already are been operating in, call it, a 60-ish percent approximately, right, output plus outcome-based contracts, right, and this is not new for those of you we met during the IPO process, we would have actually spoken about this.

A very significant portion of the dedicated FTEs outside of the 60%, right, which is standing in FTE contracts, are also, by the way, supporting this output outcome-based contracts, right. These are not sitting as pure FTE contracts outside.

These are resources in countries like US, Europe, multiple European countries, Japan, China, right, which are very specialized role like omnichannel orchestrators, digital specialists, brand liaisons, right, regulatory experts in these markets. Now these are required to make sure that you have the right skill sets, infra to run these complex global commercial engagements, which are outcome output-based.

We see that trend continuing, right, although we are already at a level which other services companies will be aspiring for, right. What we are also seeing, and that's the deal we are speaking about, is not just output, but outcome-based, right, where our incentives are linked with clients' true revenue incentives, which is revenue uptake, right, and we have experience in doing those deals.

We're seeing those conversations also expand. Those conversations also are expanding because of the breadth of capabilities and the trust we are able to bring with clients, right, of our understanding of the domain and the capability sets we have to deliver that outcome, which is as critical as it gets, revenue.

Suhas, I will pass it on to you for the order book.

Sure. Prakash, as Manish mentioned, most of our engagements are hybrid contracts.

They have a certain FTE component, which kicks in pretty early as the engagement goes live, pretty much within a month of us signing these contracts, and then, as the volume builds up, is when the output-based revenues start flowing in. These typically take 3 to 4 quarters to ramp up to its full potential for a typical million to 3, maybe even $4 million kind of a deal.

Having said that, the large omnichannel engagement deal, this was one of our largest that we announced in our quarter 3 earnings call last year, north of $10 million in ACV, is a pure outcome-based contract, wherein while the engagement has gone live, the revenue recognition is deferred by about 3 quarters because there is no FTE component in the same, and is based on client acceptance of certain outcomes, which are measured on a quarterly basis and trued up on a full-year basis. Therefore, the revenue recognition would start from Q3.

This is not something that we have signed at a full outcome basis in the past and is therefore being called out specifically and impacting the margins in the near term. With revenues recognition starting in Q3 as we anticipate, the revenue will start flowing directly to the bottom line because the costs are already being incurred last quarter, current quarter, and going forward.

If I just can add in on this part, the client has been sharing the revenue upticks with us for now 5 months, right, and those numbers are very encouraging.

Hi. Good morning.

Thank you for the opportunity. My question is regarding your GenAI strategy.

If you could explain your proprietary GenAI model in terms of developing vertical ontology and the integration with frontier models or open-source Chinese AI models, especially with the twin challenges of the IP protection narrative, which is very strong with it, and cost pressure of frontier models. Thank you.

That's a great question, and I'm glad you asked that. Our GenAI strategy for a while has been very nuanced.

We're very clear, we will not get into the trap of saying that we trained 5,000 people, 10,000 people, whatever it is, on GenAI, right. We said we're going to be solving problems for our customers.

How do I bring down the cost of an asset development, right? What kind of IP can I build so that, for example, the contract Suhas was talking about where you're doing omnichannel outreach to physicians, automatically based on the physician profile, I am able to say that, here is a method to reach out to this physician, here is the first touch point.

Based on the interaction you see, automatically there's a second touch point required, right? Those are medical writing, right?

How do I automate clinical study reports, protocol authoring, I can go on, right, 200 reports. Now that was a broad approach we were taking and solving for these problems at the highest level.

From a technology stack perspective, what we have been doing is at the real bottom end and when I say bottom, infra layer from our perspective is that we said let's make sure that we have all our data assets in place, right. We used to have our own data assets called Invisage on physician profiling.

When we acquired BioPharma, they had a data asset we've integrated those data assets. We are buying a bunch of data.

We're partnering with other people, right. We are making sure that we have access to all the public data sources and of course continue to mine our own thing.

There's a data infrastructure, we're calling it Indegene Data Universe, at the bottom of the stack, right. The second one is I think it's been a while now, we announced Cortex as our platform, right, which we're going to be using internally for knowledge engineering.

That's where all these medical experts, the creative, digital specialists, how they do things, that context get built in. Cortex was designed for two things.

One is that we want to make sure that we're separating the SME layer from the technical layer, right, the SMEs can build these workflows, do the knowledge engineering. What model to use, right, whether it's open-weight, some frontier model, we remove that from this layer.

Right at the beginning, the architecture was such that we're not wedded to one model, right, depending on the use case and what is the right model to be used from an accuracy and cost perspective. We'll continue to iterate, and we have this effort for a long period of time to be working on all models and seeing what model fits a particular case, right.

We continue to on that. On top of that is the agent layer.

I spoke about content super app, medical writing platform. Now these are very broad catch-all phrases.

Within each of these, there are multiple agents which are doing different things. When we're saying agentic KOL, right, that itself will have a few agents delivering certain different outcomes.

The same thing is true on the medical writing side. On top of agent layer is the entire what we are internally calling Transform AI, where you have the workflows, the skill sets, right, which are going to be required to deliver those differentiated outcomes.

That's a broad, at a very high level, strategy which we are deploying, and I could speak about this for a few hours, right, at Indegene.

This is great. This is exactly what, yeah, I wanted to hear as well.

You have this figured out. On a general industry,

Hello, is this better? Hello, am I audible now?

Yes, on a slightly broader market question, especially since you are dealing with such intellectual data-loaded heads, can you see any kind of a direction in terms of having more ownership of the data for the enterprises that you are dealing with? Are they slightly concerned about data protection while integrating these frontier models with your data and your agentic models?

Not really. The companies, especially the larger companies, will be very clear in terms of how they protect their own data, right.

Those contracts we will have, and that's a bit of a give and take which happens in every contract, right. We would say that our systems can learn from this data, but it stays your data, and that every contract gets negotiated that way.

Our legal team has been completely trained on making sure that they know how to do this stuff. I think what we're seeing more as a broader trend and we believe the direction the market will go into is that larger pharma companies will want to have their own open-weight models deployed on their own infra.

Their bigger concern is not with us, is what they don't want is these frontier models to be competing with them tomorrow, right, by having access to all their data. More and more, we see that on-prem, right, open-weight models being deployed by our larger customers will become a norm.

Hello, am I

Hello?

Thanks for the opportunity. I just have a question.

You have consistently highlighted your GenAI platform as the next phase of growth. Could you quantify what percentage of revenue is currently generated through AI-led platform engagements?

How you expect that mix to evolve over the next 2 to 3 years?

Chandan, unfortunately we can't break this out because, unlike other companies, for us AI is getting embedded in everything we do, right, and I think I've spoken about this earlier. We have been on AI journey not after OpenAI announced their GenAI model, right, GPT-3 or whatever it was, right.

We embarked on this journey more than a decade back, and we've been on the AI journey since then, right. Everything which we are doing, every of our asset we are building at a global level for a pharma company, whether it's commercial or medical, we were deploying NLP, machine learning, computer vision at the back of it, automating processes.

Content volumes went up 5, 7 times, right, and we continue to bring down the cost per unit using those methods, right. All GenAI has done is given us better tools to address the same problem, right, that how do we enable pharma companies to get more efficient and effective in sales and marketing and managing compliance and reducing the time it takes to do clinical trials, right.

To that extent, it is embedded in everything we do. Unlike other companies for which they are creating a new category or new line of business, here it's embedded into everything we do.

Thank you. I have one more questions.

You have given the EBITDA outlook that it will back in the historical range by 3 to 4 quarter by this year-end. Could you just tell me the key margin driver other than that you have mentioned the cost already incurred?

Other than the costs that are already incurred, given our growth trajectory, the investments that we have made in the go-to-market, the business leadership in the front, and the revenue uptick from contracted business in tectonic are the other drivers that would get the margins back into this range because those are costs that are not going to increase in line with the increased revenue.

Hello?

Just on margin part, 4Q FY27 will be in the range of around 19% to 20%?

Yes, Chirag.

Okay. Manish, two broader questions.

The deals which we started declaring in past 1 year since our listing, those are incremental one, right, in context to the overall existing pie of the business?

What we call out over here is net new business. We don't talk about renewals in our earnings calls.

Okay. What is generally the renewal base in the organic part of the business annually?

Sorry, Chirag, can you repeat that?

Renewal rates on thing. If you see, our net retention has been more than 100% for our customers.

Suhas, you want to

Typically renewal cycles are Jan to December, and while there'll be some volume fluctuations and periodically also some rate renegotiations, but those are on cycles of 3 to 4 and even 5 years in some customers. Therefore, the renewal in absolute terms would be either 2%, 3% plus or minus that 100%.

We have never lost any major enterprise deal in the renewals.

Thank you once again for your active participation and continued interest in Indegene. We look forward to your participation in the earnings call and such opportunities going forward.

Appreciate all your questions once again. Thank you all and have a good day.