Thanks, Danish. Good afternoon and warm welcome to all the participants on Anthem Biosciences 3Q FY '26 earnings call hosted by JM Financial.

Today, on this call, we have with us from the management, Mr. Ajay Bhardwaj, Managing Director and Chief Executive Officer, and Mr.

Gaurav Baig, Chief Financial Officer. I will now hand over call to Mr.

Ajay Bhardwaj for his opening remarks. Thank you, and over to you, sir.

Thank you, Amey. Namaskar.

This is Ajay Bhardwaj, CEO and founder of Anthem Biosciences. I would like to start by reporting that our consolidated revenue from operations for the 9 months ending on December 31st, 2025 for this financial year, that is, was 1,513 crores.

The CRDMO business out of which was 1,260 crores, and the specialty ingredient delivered 500 254 crores. A very positive growth in EBITDA.

EBITDA was stronger than ever at 671 crore, which gave us a EBITDA margin of 41.5%. This does include an additional income, other income of 105 crores, which was on account of forex gains, RoDTEP, and financial and other non-operating income.

When you compare to the previous year, which was 72 crores, this time it's grown to 105 crores. Now, our PBT before exceptional items was 572 crores.

We're very happy with this number. Out of this year, there was one one-time exceptional item of 25.4 Cr.

It's largely because in November 21st, 2025, the government notified four new labor codes, and as a result of which we had to take an exceptional item exceptional of 20 25.4 crores. Now, PAT after tax was 402 crores with our PAT margins at 24.8%.

When you compare this with the previous year, this is after the exceptional item, with previous year was 25.7%. In fact, PAT has grown from 369 crores in the previous 9 months to this 9 months to 402 crores.

Our consolidated revenue from operations for the quarter, now Q3 I'm going to talk about, was 423 crores. Out of which 333 crores was CRDMO and 90 crores was specialty ingredients.

EBITDA for the quarter was 191 crores, which is 41.8%, and this also includes, as I've said that there is a other income of 33.5 crores. PBT before exceptional item was 156 crores, and PAT, that is profit after tax, was 93 crore, and PAT margin was 20.3%.

In conclusion, I would like to say our 9-month FY '26 performance has shown a steady progress in revenue terms. With improving margin profile, our EBITDA has grown at 23%, and PBT before exceptional items has grown around by about 20%.

Our quarterly revenue performance was lower than the Q3 of the previous financial year, and that was influenced largely by the higher base that we had that time, although the margin improvement neutralized the revenue discrepancy. In conclusion, our underlying demand remains robust, and our historically strongest quarter, which is the fourth quarter, is still ahead, and we are confident of delivering a strong finish to this financial year.

This in nutshell has been Anthem's performance for the 9 months and the quarter that we just finished, that is Q3. I'll leave the floor for questions.

Anybody has any question, I'd be very happy to. Along with me, Mr.

Gaurav Baig, who's our CFO, is also here. We'd be very happy to answer those.

Thank you. Thanks for the opportunity.

Just want to understand your full year guidance, right? In the 9 months the top line grew at in the low double digit and the full year guidance was somewhere close to around 20 20% plus.

Is it still holding that guidance given that you also talked about that the 4Q is going to be strong? Some color on the full year guidance actually that would be helpful.

Vivek, Gaurav will respond to that.

Vivek, with respect to our 9-month performance, although revenue has grown at about 11 12%, we will have a strong finish to the year. Quarter 4 has traditionally been the highest quarter for us because that's the nature of the CDMO business, and we should be looking at a good quarter 4 as well.

What we had mentioned was we would look at a revenue growth estimate of about 20% with EBITDA margins remaining constant, margin profile remaining steady. We'll also look at a margin growth of 20% both on EBITDA and PAT terms as well.

What we are seeing right now is our margin has improved from last year numbers to current year numbers, and that has been on account of several factors which we had talked about in terms of backward integration. Material margins have improved.

We have kept our cost under control from an operating leverage point of view. We'll continue to grow on the margins, and that will reflect in a EBITDA performance which will be upwards of 20% from a guidance point of view for the full year as well, for FY '26, as well as PAT margins upwards of 20%.

In terms of revenue growth, it will be in the mid-teens around 15% to 16% is what we are anticipating to end the year with. Our margin guidance of 20% plus on EBITDA and PAT remains intact, and we will look at delivering more than the numbers that we have talked about on a 20% number for EBITDA and PAT.

Thanks. Given that we have seen margin expansion, right?

How much is likely to be structural, right? Are we seeing some flow-through in FY '27 as well, right?

Because it looked like that the gross margin have trended meaningfully and EBITDA margin have expanded in this quarter despite sharp increase in employee expenses, etc., right? Is it fair to assume that in '27 and '28, for example, the margins may trend significantly higher than this year as well?

See, our aspiration is always to have the margin trend pointing north. If you look at our document as well, what we had submitted to SEBI from when we are doing the IPO, we had mentioned that for one of the customer products, a lot of intermediates was being outsourced, and hence our China procurement had shot up in one particular year.

What had happened over the course of this financial year is we have completely discontinued that China supplies because now we manufacture the intermediates in-house by procuring the raw material, we are completely backward integrated. Hence, that shift is seen in the material margin improvement.

Structurally we want to ensure that material margin continues to improve. On products as well, we want to have yield improvement so that that could benefit us as well as our customers.

Material margin, we want to trend north. Other expenses, as well as employee costs are mostly less variable, more fixed in nature.

Unless we are looking at a significant expansion, which we are, keeping in mind that new units are getting added, but these being fixed in nature, there would be some operating leverage which should come in play. Having said so, we are operating at a good level from an EBITDA margin point of view, which is upwards of 40%, and we'd want to keep our margin steady.

Though aspiration-wise we want to grow, but we would keep our margins steady.

Understood. Just last question if I may ask, on revenues, right?

You have talked about some slowdown because of high base, but is there any disruption in supply of one or two products, etc., and whether these products are expected to come back maybe in the 4Q or next year, if you can provide some color? Thanks.

Yeah. This is a business question, for sure.

A lot of our peers, and this is a global phenomena because we had a very turbulent last 9 or a year or so, in terms of being uncertainty in the marketplace and uncertainty certainly with regard to funding as well as our customers' future plans. They have destocked a little bit, and they have rationalized their stocks to lower level of safety stocks.

That has one reason why there's been a little slowdown. Otherwise, we were very confident of delivering 20% growth in the top line as well.

However, that situation will be in our minds, and what we hear from them is that that will be corrected in the subsequent year. We are very hopeful, we are very positive.

Nothing has changed materially for us on the ground, and we continue to add more customers in the biotech space and also have added actually in this year some large pharma customers as well. The numbers are not significant yet, but once you add big pharma customers, some of these numbers can become very significant.

We're very, very positive about the FY '27 and '28.

That is great. Just you have added one large pharma customer this year, right?

Can you provide some more clarity, is advanced molecule or some, for example, molecules in the starting phase like phase 1 or phase 2?

No, we've added more than one large customer. There is some of it is development work.

Some of some of these products are in have been approved. They are going into the market.

As when a new product approval comes in, it takes time to build sales. What's good is that, we are in in in in with the customer on supply of advanced intermediates, and should the product grow, and that of course depends on the success in the marketplace.

Obviously big companies always have a better possibility of achieving success. We will grow with them.

Our bet is on the fact that as our customers grow, we will we will ride on that to grow strongly. At the same time, we've actually, as we said before, we've added four new we've had four new approvals and four four new products in the last year, in this year rather, which have gone to gone got approval.

We feel we're in a very good position to benefit from them subsequently.

Understood, sir. Thank you.

All the best.

Thank you. Thank you, Vivek.

Hi. Thanks for taking my question.

On next year, you indicated things should get better. Should we expect growth closer to what your trajectory has been around 20% in fiscal '27 on back of the existing commercial product and the new launches that you had ramping up?

Saion. Tough question to answer.

I am very optimistic, but can I give it when we're not finished with this year. When we are more into the next year early, we'll have more visibility.

Obviously, as we have said before, and that has not changed, our business tends to be lumpy. It tends to be good in some quarters, not so good in other quarters.

Directionally, we are looking northwards in terms of top line and bottom line, and we expect to maintain. If you're saying, in the next 5 years will we have a CAGR of what we've had in the last 5 years, I expect so.

Will we immediately next year, I can't say till I'm a little bit into that year. It's a little bit still distant from us.

It won't be for the want of trying. We've been very good in terms of discipline, in terms of execution, and that hasn't changed.

What has also not changed is our customer's confidence in us and the regulatory environment for us. If anything with the new announcement which is that India and US are friends again all over.

There is no tensions in trade, which had actually put a lot of unease in our customer's mind. Then with the EU-India trade deal, we expect that things are now on even keel.

That's always good for business, and I'm very positive.

Great. Just to get some color because a lot of moving parts here.

If I understand correctly, the last few years, you had quite a good ramp-up in some of your commercial products. Now when you look forward for the next couple of years, which will be a bigger growth driver for Anthem?

Would be the ramp-up of your recently commercialized product like the four that you had or the ones which are already in the market, you could get more volumes, market share, how should we think, or you're also talked about lateral contracts, I'm wondering can those sort of start ramping up pretty quickly? These are three drivers that I see if you can give some color as to which one would be the most if you can rate the importance of these drivers for you at least in the short term.

Again, you're asking a very tough question. My simple answer would be all of the above.

We would love to see all of them grow. We expect that the commercial products the ones that we're already supplying to, which are our established products, they have still a lot of headroom to grow.

There are major markets where approvals are awaited. I expect that there we'll have some very decent numbers.

As you rightly said, some of these new products, I expect that they will be a little slower to take off in the next year if you're looking at next year, but 3 or 4 years from now, we could be laughing all the way to the bank, as they say, because these would become major products. There is a lot of effort on our side to go laterally into companies, and that is also yielding fruits.

This is a hard one to answer. They've shown a lot of interest, and if we hit a jackpot with one or two of them, it will be wonderful.

Can I predict it at this point? I don't have a crystal ball.

I'm afraid not. If you say cumulatively all these three activities, that is what matters.

Put together, it will give us a stronger foundation and a stronger base, and therefore, we'll be more steady. I'm not worried, and you've rightly, Saion, you have pointed out the three edifices on which we are building, fourth being our specialty ingredients.

Also, Saion, the existing molecules, the base is higher. For the new molecules which have just come gone commercial, base is lower.

From a base effect point of view, if you look at it, the percentage growth might be look might be slightly higher for the newer molecules because just because the base is too small for them. Existing molecules, even if they continue to grow at a decent rate over there, that will help us in that will compens- that will the overall basket will then show a good growth across both existing and new.

Understood. Just if I can ask one last question before I join back.

This material cost to sales, you explain it is the gross margin improvement because of intermediate supplies now coming to India. Is the full impact already there in the numbers, or how should we think about this number in the quarters ahead?

Please. Thanks.

The impact is there in the numbers. See, that's with respect to a particular product in the CDMO revenue stream.

The material margin is a component which is a weighted average across multiple products in CDMO as well as products in the specialty ingredient side. To answer your question, the full impact is there because we don't source the intermediate anymore from China.

We are completely now backward integrated with the filings, everything taken care of. Outsourcing is nil right now, the full impact is baked in.

This level of margin should sustain in your view, the gross margin?

Yes, should be. We should be able to, yeah.

Yeah. All right.

Thank you. Thank you.

Hi. Thanks for taking my question.

My first question is on our pipeline. If you can comment on how this has grown, particularly, early phase, phase 1, phase 2.

We know phase 3, out of 10 molecules, 4 have been commercialized. Probably you would have six in the phase 3 as of today.

If you can just update on that. Out of the early phase, any indication as to how many of them are likely to move into phase 3 in your view in next 1 to 2 2 years?

Bansi, with respect to early phase molecules, we still have similar numbers, about 130 to 140 numbers which are there on the pipeline side. I think on the phase 2 programs, it will be about five or six of them, which should be in the phase 2 side, which we could expect to move towards phase 3 in the next couple of years, 18 to 30 months sort of a timeframe.

Subject to they clearing the development hurdle, because in our business it also subject to the clinical trials risk. The pipeline on early stage is still robust.

On the phase 3 side, we haven't added any more from what it was in quarter 2 of last year. Four molecules went commercial, still at six.

There was one particular molecule which had gone through FDA loop. I think it has come back to the company for additional work.

We are waiting for an outcome of that to understand what is the status of the phase 3 molecule. As of now, phase 3 numbers remains the same.

Right.

Then we generally hear improvement in the biotech funding environment in recent months. Also there has been lot of pent-up demand given the funding environment has been weak altogether in the last 2-3 years.

Are we likely to see benefits of that trickling to us as we go ahead? Are we likely to see more expansion of our pipeline, early-phase products especially?

That's a very good observation, Bansi, because your estimation is absolutely correct. We are seeing an improvement in environment.

A lot many requests for RFQs have come in the last one quarter, and it wasn't looking so healthy for a while now, but it is turning around. That's what we hear from our customers, as well.

Which is always good news for us. If the rest of the geopolitical scene settles down, of course, that is something you and I can't control, but if it happens and all indications are that at least on the trade side, we are now not at loggerheads with major Western partners, I think it will be really good for us.

You're absolutely right. I think new things are going to happen, and the rest is, of course, we can just hope and pray that the success of molecules in the marketplace gets better.

That's something that again, we have no control on it, but if that happens again, Anthem will be a direct beneficiary. Right,

that's good to know. Maybe my second question therefore, [laughter] on rather semaglutide API, given the product is going to go generic very soon.

We have spoken in the past about manufacturing API for domestic generic players here once the product goes off-patent. How should we think about that opportunity?

We also at the same time hear China being extremely competitive. I know you mentioned in the past that you are also going to be competitive in terms of pricing, but how do you see this whole opportunity playing out for us?

As we have said repeatedly, we are very much in the mix. However, many companies in India are also taking a big bet on it.

Again, I would say we are among the very few who are completely backward integrated. That is Anthem's mantra has always been that as you saw improvement of margins this year.

If we are dependent for critical raw materials or a critical input from sources outside of India, or which are not under our control, we work quite assiduously to make sure that we reverse that situation. Even in the case of semaglutide, we are arguably the most backward integrated company in the country.

Over the long term, we see a very good play in it. We are in conversations and in advanced stage of supplying raw materials for different types of testing to many of our customers within India who are playing in that space.

It is very much a position for us that we've taken. I just want to say, for us peptide is more than just GLP-1 semaglutide.

We are working with innovators and we're working with many other small biotechs because this is an area of very large interest. Anthem has made a sizable investment in developing peptide chemistries.

We work with innovators to ensure that we work on novel molecules, as well. GLP is a more immediate opportunity.

However, as we can all imagine, you yourself mentioned China will be very aggressive, but we believe we'll be able to face the competition. That's more immediate, but we also have a long-term play in peptides.

All right. Thank you so much.

I'll join back the queue.

Thanks, Bansi.

Thank you for giving opportunity. I have one question on the capacity utilization.

Is it possible for us to gauge utilization across unit 1, 2, 3? Are we fine with the available capacity for the 20% growth expectation for next 2 years?

On capacities, we have no problems. We've commissioned expansion units just now, even in unit 2.

Gaurav will give you the numbers, the details, but yeah, capacity-wise, we are good. This can take care of the next couple of years.

Meanwhile, our unit 4 will also become available. As we have said repeatedly, we have to be bold in planning expansion and also have a fair degree of first capacity to see that this business is pointing in this direction, and make those bets in advance.

Capacity-wise, we're okay. Now, sorry, Gaurav, you want to elaborate?

I'll elaborate. If you specifically on unit-by-unit capacity utilizations that you have asked for, see, unit 1 is a small-scale facility, 25 kL custom synthesis capacity, and we are almost operating at about close to 75% occupancy over there.

Unit 2 where we have 376 kL capacity from a custom synthesis manufacturing point of view, and in the in the last quarter, we had just commissioned our the CP7, which is a new block, which was about 76 kL. That block is yet to be utilized.

Leaving that aside, on 300 kL of capacity, we are roughly about 75% utilized over there, we have rough close to about 20% incremental capacity to add up over there. Neo Anthem, which is the third unit, that's still underutilized because that that also is in a very early stage from an capacity from a ramping up mode.

There we have significant scope to add more utilization. That's on the custom synthesis side.

Fermentation, Neo Anthem is yet to be commissioned. On unit on Anthem fermentation, 140 kL, we would be about 46-47% capacity utilized.

Net-net, we have decent capacity to continue on the growth path.

Right. Do we have scope for further brownfield expansion in unit 2, unit 3, or this is it what we have added so far?

See,

unit 1, full. Unit 2, full.

No scope of expansion. The scope of expansion which was there, we added in this financial year where we added 130 kL, okay?

Unit 3, after this initial completion of this expansion, which is the fermentation capacity, what we have done is we have constructed shells which could be repurposed. The reason why we have constructed shells is it prevents any element of civil work and hence any disruption which could happen onto the overall infrastructure in unit 3.

We have constructed three different shells which could be repurposed, and where we can quickly fit out on custom synthesis or fermentation or any other form of expansion which you want to do. There are three blocks which are empty blocks in unit 3.

Right.

We have scope to expand over there.

Sure. In unit 4, have we finalized yet on the modalities of which we would be making in the new unit, or is it yet to be done?

Some of it is going to be small-scale molecule expansion, which we know we will need because a lot of the thrust in early development is in small-scale molecules. Again, going by past performance, some of these molecules will start moving towards commercialization, and we will need extra capacity.

That is going to happen. Then we are going to be expanding more in peptides.

We need to add more fermentation, large-scale fermentation because there is projects that are being discussed with us on that. Then oligos.

If some of the peptide projects start looking rosier, then we will add more high potent capacities as well.

Sure. The last question I have is on the fermentation side.

We have good experience of working on the fermentation related technology, but so far, we have been limited to only pharma. Is there any thought process of going into non-pharma fermentation opportunities because some of our peers are also thinking on that line?

Yeah. Thank you, sir.

Amey. You're right, Amey.

If there's opportunity to do something which is non-pharma, and it will give us the right IP protection for our clients and the right kind of product, yes, we look at it for sure, and we are having some of those discussions. In some way it's not new to us.

We do nutrition-based products anyway, which are fermentation-based and they are non-pharma. We might even look at something industrial if it is the right product mix and it has a great future, and we have some discussions in with respect to that as well.

Yes.

Sure. Last question I have on the specialty ingredients.

What is the growth driver for specialty ingredients for next 2 2 to 3 years? One is the GLP-1.

Apart from this, what all things would drive the growth in specialty ingredients? Thank you, and I will join back the queue.

Thanks, Amey. On specialty ingredients, there are three growth drivers.

One, obviously, we've talked about on GLP-1. The second one is we're investing significantly on fermentation.

The intent over there is a lot of probiotic work what we do for our clients. Some significant amount of probiotic strains gets imported from outside of India, and hence we have tied up with a fairly large Indian customer where we are from an import substitution point of view, we would be supplying that probiotics to them going forward for India market, as well as for

other customers, as well.

With respect to this customer, for India market, as well as for ROW markets, and for other customers, the probiotics part will be a significant growth story on the specialty ingredients side. The third growth factor for specialty ingredients is the biosimilar products.

We are working on the development of a biosimilar product for a particular US customer which is an approved biosimilar drug. They manufacture it outside of India, and we've been working with them on the development of this biosimilar so that the manufacturing could shift to India and we can supply to them from India.

Major growth drivers are these three. Existing products, we still will continue to grow.

We have couple of products on vitamin K2-7, serratiopeptidase, these are flagship fermentation-based products. We will continue to grow in those products.

Probiotic strains, enzymes, these are all organic growth. These are the new areas where new probiotics is not a new area specifically, but it's a focus area for us, and the new areas are the GLP-1 and the biosimilars for us for specialty ingredients growth.

Sure. Thank you so much.

Thanks for taking my question. As we're starting work or doing work on unit 4, you mentioned that obviously there's a fair bit of order that you're sort of building up, but how should we think about creating capacity versus then getting into new business, particularly if I look at CapEx across peers both in India, China, and Europe on the CDMO side?

Is that capacity investment essential to get new business? That's my first question.

Second, on peptides, while you did mention that you want to get more on peptides, what do you think differentiates Anthem on its ability to get more business on peptides? How should we get more confidence around that?

Thank you.

Thank you, Neha. The first question is a very important and also a little bit of a philosophical question.

How do we decide what capacities to put? Listen, again for everybody who's on this call, in our business, first we have to build it and then they will come.

Our customers want to see that we have the capability as well as the capacity to handle the project. Then only they are interested in giving us the project.

See, we all admire China's scale, but they built capacities and then they were able to fill it up with the business from the world. Sometimes I think we have to do it carefully.

Far, we've done it, we've managed our CapEx versus our business fairly well, and that's reflected in our return on our ROCEs, which are very strong. We have to build new capacities, then only we can attract more customers.

When do we start building these new capacities? We start building them in advance of when you see that some of these projects that you are looking at, which are in phase 2 now, may advance to phase 3, and phase 3 to commercial.

At that point, you have to plan your capacities, and that's why we are so bullish about it. Second, of course, is our projects tend to be greenfield.

It's very hard for us to we've looked around for acquiring a good asset, but very hard to find really good assets. We build greenfield a lot and to a standard that will pass muster with regulators, as well as our own internal standards, as well as our customer standards.

I think we are second to none when it comes to that. That's another reason why we have to start building in advance.

The question that you asked on peptide, well, without taking any names, we're already making a few peptides commercially. All of them are in the generic space, and we supply to many customers in India and also in talks with customers overseas now.

With GLP-1, which our partners all recognize that we have the ability to do it, and that is the reason why innovator companies are looking at Anthem to partner with us to develop new peptides. If they didn't have confidence in our ability, they will not come to us.

Peptides is something we have, I would say, reached a fair degree of proficiency in making and developing. We are in a good place there.

I don't have any names to give you, but trust me and believe me that they are among the pioneers in peptide development in the country now.

I'd like to add something, Neha, on this. See, peptides, we started work around 2012, '13, '14, around that time, when we were doing lab-scale work for most of our customers.

We currently work with innovator peptides, close to about eight, nine programs are there on innovator peptides which are under development. From lab scale, now we have expanded into a full-blown 16 kL commercial-scale manufacturing facility at Neo Anthem.

It's a fantastic facility. You should come visit and see us on the peptide facility.

We, as a differentiator to customers, we have ability of doing discovery, development, and commercial manufacturing on peptides and manufacturing at scale with the new facility which has just come up. That gives a good proposition for customers to keep the products more development or in a late-scale project also to come to us because you don't then need to venture out somewhere else looking out for capacity to tech transfer the project.

That's a differentiator for us. On the generic peptide GLP-1, Ajay did talk about, we are completely backward integrated over there.

We manufacture the fermentation fragment as well as do the synthesis and only company in India to be completely backward integrated, and hence be competitive from a cost point of view to compete against the Chinese on semaglutide. That's the uniqueness or the competitiveness when we target our Indian customers who are looking at tapping the ROW markets, as well as India markets in the GLP-1 space, the generic semaglutide space, right.

That's very helpful, sir. Just a follow-up on the first question.

Unit 3, as we see it ramping up probably in '27, more so in fiscal '28, would it be fair to assume that we get to that 1 1.4, 1.5 asset turn probably in 3 years' time? Would that be a fair assumption?

I would say that's a good assumption. Definitely we have to do it.

All right. Thank you so much.

Yeah. Hi, sir.

Thank you for the opportunity. Sir, just wanted to confirm on the four new molecules that have been approved in the past quarter, have they started contributing to our revenues?

When can we see a full ramp-up of these molecules?

Jayesh, they have contributed revenues for this 9 months because customers have taken smaller batches because they're just looking at launching this product in the market. I think the major impact we will get to see only towards end of this calendar year when we get to know more orders from them.

This is still at an early stage of commercial launch, if I have to see a full-blown impact, maybe it might take couple of years for these four commercial molecules to show good results as what our existing molecules have shown. Some of Sure.

Go ahead. Go ahead.

Okay. Sure.

No, no, sir. Go ahead, sir.

No.

I was just going to add that the products which are for small biotechs, they don't really take off right away because more often than not, these companies are already parallely negotiating to sell themselves to big pharma. There is always a little lull.

Now that they have an approved product, they are taking quantities to go for a launch, but at the same time, they're also working on mergers and acquisitions, as a result of which we very often find that only after big pharma steps in there is a possibility of a quick ramp-up. This is not something again an event that we know fully of and we can't control it also.

This is another reason why sometimes there's a lag between the product being commercially approved and giving you the full benefit of full-blown commercial success. That time we have to wait.

Right. Sir, is the end-market potential for these products lucrative enough for large pharmas?

Any indication, what size could they reach? Are they expected to be blockbusters?

Some of them are, and remember, very often the indication in which they get their first approval is usually a small or a orphan indication. That is just to get the product approved.

Parallely, people start working immediately on other indications, and that's what's happening with these molecules, and that's the reason why they've taken more material for more clinical trials, as well. Very often a small molecule indication is a entry point, and after that is when the expansion takes place.

Some of these products are in that mode as well. One of our biggest products got one approval.

Today it has six or seven indications which are approved, and that's what makes it a blockbuster. This is happening parallely.

Just to add, Jayesh, I think in the last call, I would have given some estimates of the peak market sales for four products. Roughly peak market sales about $10 billion.

I haven't checked any changes on the analyst estimates for these four molecules in this course of the last two, three months unless numbers would have changed significantly, but my sense is a $10 billion estimates across the four molecules which are there, which got commercial for us.

Perfect, sir. Thank you so much.

Thank you very much for the opportunity. I just wanted to understand this 1,000-crore CapEx for the unit 4 that we have planned in terms of 2 years.

Where exactly are we, what would be the execution milestones and bottlenecks to watch out for?

Kartick, currently the civil work is going on. What we are doing is it's a 30-acre land parcel, we are looking at a phase 1 and a phase 2, we are looking at only half of the land parcel right now to construct, and the civil work is ongoing right now.

Significant spends haven't happened because construction takes time. I think in March '27 financial year, we'll have major portion of CapEx going out for this 1,000-crore phase 1 expansion that we are doing.

It's still in an early-stage civil work mode right now on unit 4.

Okay. Secondly, on the EBITDA margin outlook or the growth that we have got, how much is contributed by the constant currency, as most of our projects are also outside India?

See, if you look at it, what we have given out in the financial is specialty ingredients is pure-play India income because 90% of the business is India in specialty ingredients. CDMO is where it's completely export-oriented and dollar-denominated.

We as a policy don't hedge, and hence whatever appreciation from a currency what we have seen is what we recognize as an FX income, which we have articulated as the other operating income in the opening statement that Ajay had mentioned. The other operating income, which is not factored in the revenue from operations line item, is about 41 crores for 9 months, and for this quarter, it is about 6.4 crores.

Okay. Lastly, of the molecules in the early stages, do we have any ADCs there, out of these 130, 140, how many would be ADCs?

In late stage, in phase 3, there is one molecule which is a ADC. On the early stage, I would say we'll have about six to seven programs which are ongoing.

Okay. Thank you very much.

Thank you, Kartick.

Hi, sir. Thanks for the opportunity.

First is just a follow-up on semaglutide. Are we focusing on the oral sema or the injectable version of semaglutide?

Last quarter, I think you had said that process validation is underway. Any timelines for filing DMFs and have we signed any customers in India?

See, we are not in the fill-finish thing, we focus on semaglutide as the active, not the oral or injectable. Yes, we have signed up with bunch of customers in India.

Are we filing a DMF in the US yet? No.

That is something which will be subsequent because at the moment, most of our customers are focused on launching it in ROW, and that is something which we are very very well geared up for. Yes, we've done validation batches and all the rest of it.

We haven't filed the DMF, though we are in a position to do it.

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please? Hello?

I think calls are mixed.

Okay. I said though we haven't filed the DMF, though all the documentation and CMC document needed for that is ready.

We are working with our customers to do that. Yes, we are working with major Indian companies in this space.

No, I understand it's the API, but the customers who've signed with us, will they be using it for oral or injectable version? Do we have any visibility on that or we don't?

Many of them are trying to develop oral. Oral is a little hard, but everybody will use it for injectable right away.

Oral also has patents which are longer, which go a little further. I know that there are few people who are working on orals as well, oral will definitely be in the mix.

Okay. Second, a couple of questions on biosimilars.

We've repurposed the plant for biosimilar. What is the reactor scale or the capacity for this plant, and the product that we have signed, is it a mAb or a fusion protein?

Oh, it's a microbial biosimilar, and we have two trains, each of 200 L fermentation, and that can produce a lot of product because microbial fermentations are usually 1 or 2 days only as opposed to CHO fermentation, which can be weeks. It is a large molecule based on a microbial bug.

It's a microbe.

Got it. Got it.

What is the current global market size for this biosimilar and what revenue can we expect in, say, FY '28 for this product?

Oh, product is a massive, it's gone biosimilar long time ago and there are other players in it, but the company that we are working with have a decent market share in the US. They already have got this product in the market, which they currently make in the US.

The idea for them is to stop that production and shift that production to us so that they can get all the advantages of Anthem's technology as well as the low-cost input that we provide, and they have a fairly decent business already. Remember this particular area, it's been generic for a long time.

There has been no replacement for it. There are other players who make this, but in this space, though this is a very old molecule, it's the only one that is approved for this indication and no new replacements have come.

It has stood the test of time.

Okay. Can you comment on the future pipeline for biosimilars?

You said this is a microbial, but can we also do CHO-based, mammalian biosimilars? Where are we on the other biosimilars?

Sanjay, we are working on a bunch of projects there, and those are also biosimilars. Again, we have chosen some products where there are no biosimilars available even though the product has gone off-patent, and one of them is fairly advanced, and we expect that that should go in the market in the next 2 years.

Oh, then is this 200 L capacity enough for Not at all.

We'll have to build new capacity for that. That's something which is going to be a separate facility.

Unit 3 has we've created, as we said, the infrastructure already. What we are putting in place, and that's already passed the design stage, we are now just negotiating with vendors to supply partly single-use and partly fixed fermentation for CHO cell.

Okay. Final question, if I can.

What will be the CapEx that will be needed to set up a 16 kL peptide facility? Just trying to understand the replacement cost.

See, if you look at proportionate CapEx including the other utilities which is set up as part of the facilities, then roughly it will be about 200-odd crores.

Okay. Got it.

From this 200 crore

Because that will be you set up other utilities like ETP and ancillary blocks, etc., which is common to the plant. Right, right, right.

Peptide one block, other blocks are there, you have to proportion that as well. From that point of view, it will be roughly about 200 crores which will be there.

Okay. Let's say we make 200 kg output of peptides, what kind of EBITDA margin can we make in peptides, be it GLP-1s or other generic peptides?

Oh, yaar, we are very confident that we have done the numbers. I don't have them in front of me, but it is eminently doable.

We so far have been laser-focused, I would say paranoid about margins, and I don't see that going away. Trust me, we are in a very good place.

For instance, you just take GLP-1. Making the peptide is only half the story.

There is a fermentation element. You have to be able to do fermentation effectively and at a cost All of you know P29.

P29 from China is very very competitive and cheap. We find that still a very attractive proposition.

We don't see any bodies there. If you take the whole manufacture of, say, GLP-1 right from fermentation to the finished product, we will be able to get the EBITDAs that we've been historically been used to.

Okay. Even if, let's say, sema API prices crash to, say, $100 per gram, we could still make 35% kind of EBITDA margin in peptides?

Oh, absolutely. 100 would be a nice price.

It's a dream.

Wow, okay. That's good to hear, sir.

I think

I believe it will go lower than that, but yeah, 100 would be very nice.

Okay. Got it.

I think that's it from my side. All the best and thank you.

Thanks. Thanks, Sanjay.

Yes, sir. Sir, I just wanted to know about any destocking we are facing in any molecule, and so that is leading to some sort of soft performance over last few quarters, and the situation might improve in the coming quarters.

Second question was about what portion of our portfolio will comprise of GLP-1 drugs in FY '28? Thank you.

Vivek, you're right about destocking. Hello?

Yeah. Yes, sir.

Some problem with the line. See, there has been definitely because of the general geopolitical tension that we have seen in the last 1 year where we have been in loggerheads with our major trading partner, United States.

It has put a lot of anxiety in the mind of big pharma as well as small biotechs. They have been very wary about building up too much stock and carrying too much inventory, they have been a little bit mindful of reducing the number of days of safety stock.

That has affected us. Otherwise, we would have had been a bumper growth this quarter also.

Again, we are seeing signs of recovery that all the destocking that had to happen has happened, and these results that we are reporting is subsequent to that. We feel that going forward, we will be in a very good position as far as filling up the new requirement which will be post-destocking.

That is one. On the GLP, again, what percentage of revenue, I don't know.

Hard to say. Will it be a significant part of our turnover, I would say yes.

Will it be 20-30%, I don't think so, but it still will be a major contributor to our top line as well as our bottom line.

Sir, this recent budget announcement of India, was there some incentive for the biopharma companies? The trade deals being signed in US, EU, UK, and other countries also, how does that play for us, sir?

Thank you.

The details of that, Vivek, are yet unknown, I don't really know how this will play out with the US and all that. The government is encouraging, which is a good thing.

The government sees biotech as a strategic sector of economy. It should have been recognized long ago, but it's better late than never.

I think that this will definitely have a very positive impact. They're offering incentives and PLI-based things.

I don't know. The details will still come out.

Anthem is already, regardless of what the government policy is, we are firmly entrenched in this. We've been doing this for two decades, and before that, I've been involved for four decades in this now.

Biotech is very close to us, and we will continue to. If the winds become favorable from the side of the government, then it's even more gives us more tailwinds.

I'm just very bullish about this. I'm super confident that biotech, which we've talked about for such a long time, as a sector, its time has come.

Thank you, sir.

Thank you. Thank you, Vivek.

Thank you very much to JM and to all the people who are on the line. Unfortunately, only so much time and, only that many questions.

As we said, we would communicate to us we have tried to be as transparent and as open about how we see the prospect of Anthem and where Anthem is headed, and we really appreciate the support that we've got from the investors and the investment community. You will see that regardless of what happens in the in this in, going forward in the geopolitical situation, Anthem will continue to invest, continue to invest in technology, and our edge, which is something that we are laser-focused on, is doing the same things differently and doing different things.

That will not change, that is our mantra. Thank you very much for being on this call, and I look forward to talking to you again at the end of the year.

Thank you, everyone.