Good afternoon, everyone. I welcome you all to Gufic Biosciences Limited Earnings Conference Call for the third quarter of financial year 2025-2026.

We have with us today for the call Mr. Pranav Choksi, CEO and Whole-Time Director, Mr.

Devkinandan Roongta, CFO, and Mr. Avik Das from Investor Relations team to give the highlights of the business and financial performance of the company and to take questions, if any.

Before we begin, I would like to say that some of the statements that will be made in today's discussion may include certain forward-looking statements, which are projections or estimates about future events. These estimates reflect management's current expectations about future performance of the company.

These estimates involve a number of risks and uncertainties that would cause our actual results to differ materially from what is expressed or implied. Gufic does not undertake any obligation to publicly update any forward-looking statements, whether because of new information, future events, or otherwise.

I hope you have received the investor presentation that we have posted on our website. I will now hand over the call to Mr.

Avik for sharing the business highlights. Over to you, Avik.

Good afternoon, everyone, and thank you for joining. I'll start with a brief update on what progressed across our business units, where execution is tightening before Pranav takes you through the divisional performance trajectory and Indore ramp-up.

Across the domestic branded portfolio, the focus remains consistent, which is drive protocol-led depth, improve mix through science-backed differentiation, and scale through repeatable execution rather than only through launches. First, on our hospital injectable platform, execution remains hospital-first and account-depth driven.

In critical care, we continue to concentrate on protocol-heavy segments of sepsis and other resistant infections and invasive fungal diseases, where the adoption translates into repeat ordering. Over the period, we progressed evidence-led positioning and hospital adoption for some of our advanced molecules, including Thymosin alpha 1, which is ImmunoCine Alpha in sepsis adjacent immune dysfunction, and Dalbavancin, our brand Dalbavan for resistant Gram-positive infections, and Isavuconazole, where we have a brand called Isavufic in complex fungal infections.

The emphasis remains on increasing molecule class share within existing ICU accounts and scaling through corporate chain and tertiary hospital penetration. In Sparsh, we tightened the operating engine.

We brought in a lot of distribution control and collection discipline and conversion inside hospitals while continuing to build differentiation through formats like dual chamber bags. The next category triggers in Sparsh will be contrast media and the total parenteral nutrition range, which we will be launching.

The progress to expand wallet share within existing accounts is also progressing well. Now, on our women's health platform, it's been a shift towards prescription-led engine with deeper lifecycle coverage.

In Ferticare, the strategy remains centered on reproductive immunology and increasing share of cycle in IVF. Core brands continue to compound very well: Gufigin Alpha in recurrent implantation failure, alongside Puregraf and Cintrocare.

We progress pipeline work on super pure urinary FSH to expand the stimulation opportunity with high purity and yet very cost-efficient propositions. In Zenova, the execution cadence improved and our power brands continue to anchor growth, which is DD-1 and StretchNil.

With fertility adjacency building through Fertifos, the pipeline remains focused on the larger women's health therapy pools of endometriosis, PCOS, and menopause. This will help us widen our long-term prescriber relevance.

Now coming to the toxin platform, here we're building a high lifetime value franchise through capability creation and structured market development. In Astaderm, we continued scaling Stunnox, which is our botulinum toxin type A, while building the capability bridge to a broader aesthetic platform.

Injector creation and chain clinic readiness and Indian clinical data generation is something that we focused on to support premium adoption. In NeuroCare, the progress remains very methodical, which is expanding the therapeutic toxin coverage just beyond neurology into urology, ophthalmology, pain, and neurosurgery, and of course, anchored on indications where adoption is guideline-driven and long-duration.

Now coming to our Neutra-Ayurveda platform, where we are sharpening our focus into a chronic care platform, we continue strengthening a differentiated pain proposition such as the upgraded Gufic-Oil while building on the GI opportunity with vonoprazan, where we have a brand called VonSa as a prescription-led growth lever. Now I'll give you all a quick highlight of our international business, where we are moving towards an IP-controlled complex injectable-led market access model.

During the period, we saw regulatory progress in regulated and priority semi-regulated markets, including Colistimethate approval in Germany and regulatory continuity actions for Pantoprazole injection in Portugal and Vancomycin injection in Lithuania. We expanded registrations in Myanmar across a basket including Pantoprazole, Azithromycin, and fertility hormones, and strengthened the quality gateway through Unit 2 GMP approval in Oman, which opens up the lucrative Middle East market for us.

Finally, on Indore, the ramp-up continues in a stepwise, compliance-first manner with disciplined tech transfer and scaling aligned to our audit readiness. Pranav will address the Indore ramp-up curve and how the divisional execution has translated into our overall performance trajectory.

Now over to Roonghta sir for the overall quarter numbers.

Thank you, Avik. I will going to give a financial highlights for Q3 of financial year 2025-2026 versus Q2 of financial year 2025-2026.

I'm not able to compare the Q3 of 2025-2026 versus Q3 of 2024-2025 because the Indore plant was capitalized during the last week of December 2024. I'm making a comparison of Q3 versus Q2 of financial year 2025-2026.

The turnover for Q3 is 231.1 crores compared to Q2 of 230.4 crores. The EBITDA for Q3 is 37.1 crores compared to Q2 of 37.5 crores.

The EBITDA margin for Q3 is 16.05% compared to Q2 of 16.25%. The PAT before tax for Q3 is 21.1 crores compared to Q2 of 20.5 crores.

The PAT margin is 9.13% in Q3 compared to 9 8.90% in Q2. The profit before tax is 15.63 crore 15.6 crore in Q2 compared to 14.9 crore 9 crore in Q2.

The PAT margin is 6.75% in Q3 compared to 6.47% in Q2. Thank you.

Sir,

Yes, you can. All right.

Hi. Am I audible?

Yes. Hi, team.

Just wanted to understand some more that the ramp-up as was discussed in the last call that Q3 and Q4 will see a disproportionate rise as more of regulatory approvals come in and exports pick up. The numbers are saying otherwise that there are many segments, many interesting developments going on, but we are seeing growth of only 11% to 12% on a year-on-year basis, and even quarter-on-quarter, it's flat.

Any color that is this due to some CritiCare price erosion, or what is the scenario here?

Hi, Nitya. Pranav here.

Yeah. If you recall the call of Q2, we already had got Mr.

Rajesh Kaul for Sparsh, and in CritiCare also, if you remember, we were directly billing to the hospitals and we were in the process of revamping our operations, a part of CritiCare and also Sparsh, from direct hospital supply to taking it back as a stockist, because a lot of our working capital was getting affected in the long cycle. As last quarter also we took a hit of around, I think, 5-6 crores, this quarter also we have taken a hit of 14 to 16 crores.

If you remember, the debtors at a turnover of 800 crores was around 320 crores last year, approximately. I might be plus-minus.

This year our target is also with the jump from 800 to whatever we end up 900-plus, maybe 920, 930, whatever, so that way also we want to bring the debtors sub-300. When in July Mr.

Rajesh Kaul came in, we did a recce of the market that which all are the primary, secondary, or tertiary hospitals, what is the reason that this money is not coming? Is it stock, or is it just cycles, or is it some other evaluation?

There has been a comprehensive approach which started in of course Q2 where the impact was only 5-6 Cr. This quarter has been 14 to 16.

As per our estimates, in Q4, it might be between 3 to 5 Cr more. That is what we have taken a hit once to get that product out and get the debtors in control, because it should not happen that the expiry of the product also comes and the hospital still refuse to pay because they are ready to keep the stock at our expense.

At the same time, we saw an uptrend in exports and we saw the uptrend in Ferticare as well as in other segments. Now Indore is also ramping up.

We don't want to compromise the ramp-up of Indore in terms of the working capital by just in the Indian market still give those freebies without any recourse. That's the reason that this consciously has been done this year, because like I started the call in Q1 or Q2 also, that 320 for 800 was quite not digestible neither for the CFO nor for me, and it would not be a good sign in the market also.

That is how this is a thing which we have done. Majority has been finished, like I said, 5-6 last quarter and 14 to 16 this quarter.

Next quarter, even with that 3 to 5, we are still looking at that improvements to come in because other things start kicking in. Even without the GLP uptake, we look at some positivity.

Yeah.

Okay. Is there any price erosion in the CritiCare segment or have the prices stabilized?

No, no. If you see the gross margins are not a concern.

If you see, that's not a concern, very frankly. On the contrary, the Aztreonam-Avibactam, which was supposed to be launched, will be launching hopefully by this quarter or maybe Q1.

That'll also add in the margin. Erosion, I think that the worst has sailed.

The APIs and all that is done, I don't think that's the process. At the same time, even in fertility, the price is quite stable.

On the contrary, even taking this hit back, the exports have compensated, so that's why you see the gross margins not getting affected much.

Right, right. Understood.

What is your outlook for FY27, say, that once you move onwards from, say, 30% capacity utilization, are we looking to see a 20%-plus kind of growth number in FY27? Because it's been a very large capacity expansion.

When will we start seeing a tangible payoff? I understand after the debtors have been sorted out, but when are we seeing a larger growth come in in FY27?

What is your expectation on that?

I would still stick to that that if, from an 800-odd number, 800, 810 last month, to maybe, sorry, last year, to maybe whatever, 920-plus this year, yes, definitely a minimum of 15% is what we look for next year. Like I said, we in it's a mandate given by the CFO and myself to the team that whatever has to be done, we want to migrate to that stockist billing as soon as possible and don't go for that, I would say stretched working capital.

I don't think the impact of that what do you call this Sparsh and CritiCare would stretch on beyond this year. A 15% bare minimum is what we target for '27.

Understood. On the regulatory side, is there any updates you'd like to give in terms of

Yeah. Our EU audit has been completed in the month of December and that went well.

We hope, like I mentioned, that the certificate should come by March or April. We only are at that thing, and so we hope that the business as we are committing, if you see the earlier slide also, I think Avik must have presented in the presentation, we look at Q2 max Q3 for uplift of EU markets at least from Indore.

In the meanwhile, there have been certain other contracts for Indore which hopefully also should start paying off. That is a possibility, yes.

Okay. Thank you.

I'll get back in the queue. All the best.

Yes.

Hello, am I audible?

Yeah. Thank you so much for the opportunity.

A lot of my questions have been answered, but wanted to understand, you explained the domestic business and you explained the international business. We were also expecting some uptick in our CMO business this quarter and going towards next quarter.

How is that panning out to be?

If I don't go for the correction, we are still looking against that 200 crores almost a 20% jump Q-on-Q if we remove this 14 to 16 Cr, what I'm trying to say. Definitely, because as we all know, Navsari is chock-a-block and saturated, Indore is getting the offtake.

There have been some GLP-1s validation batches also we have taken. Apart from the audit, there have been other clients also who have come in.

That is happening. I'll give you some sort of a numbers.

Whatever exposure was around maybe 20 to 25 crores total output from Indore per quarter, that has at least gone to around 36 to 38. That's a positive sign and we hope that should go to close to 40, 42.

I'm saying this includes not only the external numbers, but our internal production also. These are all positive signs from Indore which will help us to take that uplift.

This is even without the exports kicking in and this is without that. All this is coming is because of our internal and CMO only.

Understood. Understood.

In terms of the cost base, right? Employee benefit expenses has been going up quarter-on-quarter for the last four quarters.

Today it's at 40-odd crores. How much of this would be because of the one-time labor costs, and how much would it be due to organic?

I think Roonghta sir will be a better person to answer that and maybe I'll chime in in terms of output later. Roonghta sir, you want to talk about the employee expense, and then I'll come in in terms of the output also.

Basically, if you want to see the other expenses, no, it's also includes the R&D and validation expenses. At least for two one and a half to two years, this expense will going to be in part of recurring expenses because Indore requires a lot of validation batches

No, sir, my question was on employee benefit expenses, not other expenses.

Okay. Okay.

Employee benefit expenses today is around 40 crore per quarter. It will going to 160 crore rupees per year.

Next year, another you can see a hike of around 7% as annual increment. The number is now fixed.

It's only annual increment which has to be given to the employees. It may touch from 160 to 175.

Understood. Now this is a reversed standard now cost base.

40 is the largest quarterly expense that is expected?

Almost all recruitment has been completed. There is no fresh recruitment, and the increase will going to come an annual increment to the employees.

This may increase from 160 to 175 crore.

Understood. Understood.

Pranav, the question on productivity, how are we looking at Productivity,

There have been some six there have been some six high-profile appointments also this year. As you must have read, apart from getting Dr.

Rajshekhar for the international business, then ramping up his team for international business, and that's why you see that international business going from almost 120 to, on a higher side to going to around So almost the majority of the growth almost of around 60 to 70 crores is coming from the international business, whereas the base was around 120. I'm talking about the formulation exports, not the API exports.

Similarly, for Dr. Rajiv Agarwal for infertility, and then Rajesh Kaul for Sparsh, at the same time Vijay Kumar for Galderma from Galderma, of course, for Stunnox.

At the same time also, we also have ramped up, like what Roonghta sir rightly explained, if you see Indore, which was an average of around 350 people on an average, and of course, I'm saying post the capitalization was out, let's take the January to March quarter, which is a full quarter where there was no capitalization, there the 350 has gone to a rightly peak of around 480-500, which is what Roonghta sir rightly said where we need to take care of all our requirements in Indore. Even though the output on productivity has gone only from I would say 25-26 to around 38 to 42, the employees are full-fledged now.

Now even if I want to get my sales increase from 42 beyond, we are almost at the peak, except for the yearly increments which would come in in terms of Indore. Of course, for Navsari and for field force, as he rightly said, the average increment would come to 6% to 7%, assuming of course the attrition.

Average that would normally 6%-7% is what we foresee from year to year from now on.

Understood. Understood.

Just last question before you come back in the queue. You answered to the previous participant that we are looking at a 15-odd percent on the bare minimum for coming in in FY27, '28.

FY20 Yeah, FY27 and your FY28. Now, the question is that because a lot of things are happening, we've got GLP-1, a lot of our CMO customers moving from Navsari to Indore, and fingers crossed we get our EU GMP earlier than expected or as expected maybe by FY26.

You said that by Q2 or Q3, the revenues from the international business from Indore should start materializing. What is keeping us on the fence to say that not 20%, but 15%?

Is there anything that we should be aware of?

No. I again say that one thing we have realized that as you try to go on the international front, the working capital is the most crucial thing, and that is something has become a little bit more sacrosanct in the organization right now.

Even though this year we could get those numbers, we have been very disciplined about it. I don't want to have one more year where I commit something and I don't deliver.

At least what we give is what we should deliver. Of course, there are of course many other moving parts, which are positive.

If that comes anyway, that's always a positive sign. You will never question me for that.

I always feel that when you putting me on the block, 15% is high time we give you bare minimum. Whatever goes beyond, we'll take it at that time and be happy or not, let's decide at that time, yeah.

Understood. Understood.

On the on the CMO front, last quarter when we were discussing, you said that 50% of the client, of the 12-14 major clients, had moved moved to Navsari and oh, sorry, Indore from Navsari, and we are also introducing a couple of new vial products within them. The the the question is that and you also mentioned that Q3 might not be that big of a quarter, Q4 we can expect a good quarter.

If you can if you can shed some light on that, how to look at it, how to because at a 925 crore, what will be the CMO percentage CMO revenue percentage?

Absolutely. If you see, when I mean 50% of my So we have a Unit 1, which is the hormone and other general facility, which is the legacy facility.

Then we have a penem block. Then we have a Unit 2 at Navsari.

These are the three main units apart from of course the botulinum toxin. The Unit 2, which is EU, Brazil, Canada, and all these other accreditations are there, out of that 50% clients have all moved to Indore, because we had to get the capacity free for our export orders to be taken care of.

Because

even right now, the order book which we have is more than around 150 to 155 crores at any time which we are running with, which is very high. I want to bring that order book down to at least 80-90 crores, and it's almost like a 90-day window which I want to bring it down to 60-day window.

That is the main purpose. That definitely is happening in Indore from the Unit 2, and that is where we feel that this will take on.

Now, more interestingly, we also have got certain projects for GLP-1 in Indore also, apart from what we had in Navsari. A little bit because of those validation batches and because of almost that went for almost 33 for one of the big pharmas, they have gone for a little bit bohemian approach to GLP-1 from Indore, apart from the normal conventional liquid products.

That is where our facility also look because we see a big upside happening there also. That validation batches also are now getting done.

It got done in January and we are seeing the testing happening in February. A little bit of that December and Jan also went in that validation batches of the GLP-1 from Indore for those things, where we feel when you go for any validation or anything, almost your entire equipment is blocked for 3 days or 4 days, where it normally should be blocked only for 1 and 1/2 days.

Those are the two factors I feel should also take it more, and we also are pushing more and more of our clients. We hope that by March or maximum by June, at least the now remaining 75%-80% remaining 50% mein se bhi 75%-80% also move through.

We become a little bit decluttered, because Navsari's orders from UK, Portugal, and Brazil, and all that also ramping up. We hope that positivity we can pass it on in terms of numbers.

Understood. No, wishing you all the very best.

I have a couple of more questions, I'll come back in the queue. Thank you so much.

Hello. Hi, am I audible?

Pranav, I just had one question on the botulinum toxin piece of our business. We've been working on it, developing it for almost 3 to 5 years now.

What is the current size of that business, and how is it compared to the last couple of years, how has it grown? With the team expanding, how do you see the growth in this segment for the next maybe 2-3 years?

Also, if you could just highlight what is our capacity here in terms of sales potential, and if there is any potential in terms of exports for this product.

Yeah. If you see the total botulinum toxin market in India is around $20 to $25 million US both for therapeutic and aesthetics.

We are approximately at 23% of the market share right now in terms of IQVIA, which is there. We are around 25 to 30 crores right now, which is our total market share, which includes our aesthetics, our therapeutics, and of course our government supply also.

Now this has of course evolved from 2021-22, where the actual launch First, the aesthetic division was launched, and then in 2022, the therapeutic division was launched. We grow on an average around this year, of course, it was around 22% to 25%.

The last 2 years, it has been 30% and 40%, because the base is very low. Now this I foresee for it to grow in this thing.

Luckily, with the team coming in in the month of February of Mr. Vijay, Dr.

Jha, and Dr. Jyoti Jha and the entire team, a little bit there also we have a little bit upgraded our selling talent.

There also, we have taken some teams from Galderma and Toxin, which brings a lot of credibility. The perception what was earlier, it's an Indian toxin, now you have multinational team members endorsing it.

We have now clinical trials also now published. We've one published, the second one being published by the end of this month in February.

Those are bringing Today also, I'm right now in Navsari just attending the call because we had some doctors visiting in terms of a scientific presentation discussion on botulinum toxin. We hope that this is a more of a educative thing and it's more of a scientific thing, which will of course gather pace in terms of 20%-25%.

There might be a hockey stick, which might come for the entire country when the entire category gets expanded, and we hope that we are in the first few to take it up. More importantly, what we lack, I'll tell you.

What we lack right now is that, right now doctors, when they endorse our toxin, they said, 'Do you have an incomplete basket? You don't have a filler.'

When they go to a Galderma or for Allergan, they have a toxin, they have a filler, and as in combination, they feel, 'If I stop buying an X from thing, I have to keep everyone happy, I get only some part of the share.' With our agreement with the Canadian company, which will be which has been signed Of course, it has been signed now, I can officially say that right now.

With that coming in, we should be hoping to get that product launched by July. Now with that product coming in, we always will there will be no excuse that why a doctor should not endorse our product, because we have an, we have a product of fillers which is number two or number three in US, which has a total revenue of more than, $110 million, and we can backpack on that along with our toxin, and it can be a good, I would say complementary basket.

Then that also helps us to get a little bit more market share. Even without the filler, we are able to get that 23% with 23% market share in a market where of course Allergan is almost like a 50% dominant market.

We hope we can take more share from them in the years to come. More importantly, the category expansion to come, so that will help us to take into the Indian market.

Coming to the international market, very frankly, let us first my view is that for the next 2-3 years, let us focus on revamping the Indore, getting the I would say domestic market taken care of, have a robust system in place for both aesthetics and therapeutics, and get the fillers also in place. Then maybe from next year end, once the Indore is fully ramped up, maybe in 27-28, start thinking for toxin for the international market.

There have been opportunities, but we would like to keep it in the future.

Great. Sorry, in terms of sales potential in terms of capacity, expansion would not be a challenge in this segment, if at all demand comes?

No, no. Sorry,

I missed that question about the capacity. The capacity is right now I sell almost around 20,000 vials per month.

My capacity can be even 20 10 lakhs, 15 lakhs also, that's not a problem. Right now with 20,000 per month, these are the revenues what we have, 25 to 30 Cr.

That's not a bottleneck for botulinum toxin. Even and as it's a product which we have our own strain, we're not dependent on any third party also for APIs or toxin or something.

Everything is made in-house. Yeah.

Great, that's very encouraging. Also, one small question on the margin side.

We've given a 15% top-line bare minimum growth guidance. What is it that we look at in terms of margin trajectory with Indore ramping up?

How do you see that panning out over the next 2-3 years?

Can I request Roonghta sir to take this question? It'll be more precise, yeah.

If you see the present EBITDA margin is around 16%. After 2-3 years, when the capacity utilization of Indore will rise more than 50%, we expect the EBITDA margin will raise from 16% to 19%, and once the utilization reached more than 75%, the EBITDA margin may touch between 20%-21%.

Great. Thank you so much and all the best for your future.

Thank you. Thanks.

My question is already answered. The same question I was going to ask about the margin part, because this quarter what I could see is that almost we are nearing 30% utilization at Indore and still margin is compressed to 16%, because this was earlier mentioned that Indore with which matlab it will get EBITDA positive or EBITDA accretive at 30% utilization.

Is there any fixed cost is the only thing which is dragging the market or the opex has slightly increased this year? That was my question.

Basically, today only because of the fixed cost, today the EBITDA margin we are expecting at a break-even in the Q4 of financial year 2025-2026. In '27, we are expecting end of the '27, we are expecting that interest and depreciation will also be absorbed by the Indore.

After '27, it will start giving cash margin and as well as profit margin

Are we expecting Indore to reach 50% utilization in FY27 by end of FY27?

By end of you can expect in Q4 of 26-27 the utilization may touch to 50%, but not as a average of whole year.

That's great. One more last question if I can add up to, when is the UK MHRA planned?

Because it was originally planned for Q1. Is there any definitive date available there?

You're talking about Indore, right, sir?

Yeah.

Talking about UK MHRA. Indore, actually audit has happened in the first week of December from EU, Portugal.

If that goes through, then the UK also accept the same in terms of harmonization. That audit has been done in the first week of December 2026 2025.

Yeah.

Oh, okay. Okay.

The Q2 or Q3 you said the orders and other things will start kicking in which was hindering the growth, right? The export growth.

Yeah. The export revenue from Indore will start kicking in for the Europe and the regulated markets from Q3, Q4, because we also have a Saudi audit also in April.

In the meanwhile, there are some basic registrations Southeast Asia and other markets where the export already has started from Q4 2026, and it'll continue going on, like Africa, Southeast Asia has already started from this Jan 2026.

Okay. You can update something about Selvax, the new investment you did, and the progress over there, if you can just give a little bit more clues.

I think it's a very far thing, but just to share with you, as this is a cancer vaccine therapy for solid tumors. They had a very good remission rate of more than 68%-70%, maybe more, I think Avik will be more precise with the numbers.

Right now they are plasmid and their gene is already ramped up. They also are now in the process of getting it outsourced to Syngene to get their final construct ready.

For that, there was a requirement from all investors to pitch in something, and that's why we also felt that we should be part of the story, because we have 100% India rights and we have also rights for the some part of the Europe also. This is a thing which I still am Totally, I believe we must have invested close to $150,000 till now in the last 4-5 years.

It's something very long-term, but I have a lot of hope and expectations. Let's see when it comes.

It's very far-fetched. It will still take 5-6 years.

Yeah. It's like investing in a startup sort of.

Thank you.

More than startup, with good clinical background and good clinical data, at least on an animal level. It's not completely proof of concept.

It's proof of concept with some animal data. Yes.

Yeah.

Right. Thank you.

Thank you.

Thank you. Am I audible?

Just two questions. First, just want to understand that when we started the direct-to-hospital approach, we thought we would get some kind of understanding of the patterns, etc., and now we're rolling it back.

What exactly what issues did we face that we're trying to roll it back?

If you see during Sparsh and some part of PrimaCare in CritiCare, we wanted to go to the primary and secondary nursing homes apart from the tertiary ring, because we always thought that the tertiary nursing homes, the big big guns of the Indian hospital industry, they normally pay in 150-180 days, but there we have distributors. When we thought that there'll be a better margin improvement, and there'll be more penetrative data where the margins will improve.

The margins, of course, did improve, but the problem was that the margins improved at the cost of a payment coming after almost 150 days or 180 days, where earlier we were a little bit, I would say shielded by the distributors used to pay us in 30 to 45 days. Now that thing happened in the last 2 years.

That's how from September, from August end, September, we started changing this. The main thing was the database.

I'll come to the database. What we tried last year, everybody knew this could not carry on, from, I think, around October-November 2024, I believe, we also started requesting all our stockists to install Marg.

Marg is a particular software in India where the sales from a stockist to the primary, secondary, or tertiary home can be checked, and at what rate is checked. That took us almost 8 to 10 months to convince the stockists that when we are installing this Marg patch or this data, none of their IP data will come to us, it's only that we will get data related to Gufic.

That implementation took time. It started in November and it eventually got done by September 2025.

At that time that once we knew that now the Marg data is good enough, we thought this transition makes sense because at least we can still keep a control where our products are going. Then we started this call that once now the Marg data is in place, let's start getting a little bit more about those hospitals which are eventually laggards and not paying us on time, at the same time stretching our working capital.

Yes, of course, with this, there will be a hit of around some X percentage more, but that when I compare it the working capital and the interest cost, it's I think almost makes no difference. This is what we took a call in August-September 2025.

Understood, sir. Just one more question.

I think in your presentation you have spoken about in Astaderm you have spoken about the global in-licensing and I'm assuming that the same you referred to the Canadian brand. Is this any kind of tech transfer or is it a pure licensing deal?

Can you throw some light on that and what potential does it have?

It's a pure licensing thing. The total fillers market in India is around 200 to 230 crores, the toxin market is around close to around 120 to 140 crores, depending on the exchange rate and all that.

We feel that the fillers also once coming in, we can also play around. More than the fillers, they have a good product in the pipeline in terms of PDRNs and those other conjugates, which have been new-age things.

Fillers are now, but the future products are going to be PDRN and exosomes. Also they have some unique medical devices which help us for administration of certain specific aesthetic products also.

It's a good collaboration. Plus they also have two big training centers in UK as well as in Canada, where a lot of new-age development of combination treatment of fillers along with GLP-1s and also other things are coming in.

That also going to add value to us. This is what we feel it's a good mix for us.

Understood. Just the last question if I can squeeze in.

I think you spoke about a previous question about Sparsh that we this quarter took a hit of, let's say, 15%-20%, and if we take it on the higher side, that's on a Q-o-Q basis, that's still 5% to 6% growth. Is there something more to it because we were of the idea that Q3 will show some decent ramp-up considering tech transfers have started and then Navsari will be free for some exports.

Can you just clarify that?

I didn't understand your question. You're saying that 14 to 16 impact was there.

Can you repeat your question again? Sorry, I missed it.

Maybe I didn't understand, yeah.

No, no. I'm just just trying to understand that even if we take the if the 20 crore write-off or the issue that we have and consider that that it that was considered as a revenue, that's still a 5% to 6% growth on our previous quarter.

We were of the idea that Q3 will be Yeah, Q-on-Q, yeah. We were of the idea that Q3 will be quite better considering the tech transfers happen and then Navsari is also free for exports.

Just wanted to clarify

Now I'll explain. I got your question.

If you see Navsari's revenue are mostly saturated at the 800 mark. Of course, the normal domestic growth which comes, it comes.

If you see the entire growth which has been coming in is because of the Indore ramping up coming in. What the expectation of doing 10% or 15% on 230 is not what the statement I gave, but yes, definitely I gave that we would be coming close to that 250 mark.

If you see last year in the same period with Indore starting in October 2024, from October to December, we had done, I believe, 200 or 205 crores. From there, revenue here would be almost at a 20% jump.

Yes, Q-and-Q, I don't foresee that drastic jump coming in of 10%, 15% Q-and-Q. Definitely as overall as a business, 15% to 20% is what we are foreseeing, because regulations take time, validation batches are still ongoing.

Also, there have been a correction in terms of debtors control this year, so that's why overall as a package, we feel that this year will be a little affected. Next year, again, I think someone pushed me to answer that, I said, yes, minimum 15% what you should look for.

Yes, hopefully with other positives kicking in, 20% is what we should aim for, or more. I think 15% is basically what I give.

Like you said, there are erosions coming in, there might be environmental factors, there might be something else. We don't know how the GLP landscape will also come in.

In terms of my word, I'm trying to be a little bit conservative and trying to achieve first and then talk more.

Got it. The audit that happened, that's the same as EU GMP, right?

Is my understanding correct? It's

EU GMP only. It was from Portugal, yes.

EU GMP only, yes.

That's allows us all across Europe, it's for

It allows Europe, Colombia, South Africa, UK, everything, yeah, which is same thing in Navsari.

Sure. Thank you so much.

All the best and thank you.

Thanks.

Hi, thank you again for the opportunity. Sir, just wanted to get the numbers of our SBUs and how they've performed YoY and QoQ, and then you can also maybe segregate how the domestic branded business has performed.

Sorry. Can you repeat that, brother?

I just missed it because of the network issue here.

Yeah. Sorry.

What I'm requesting is that if you can tell us how the SBUs have performed, that is domestic branded business, international, API, CMO. Then you can double-click on the domestic branded business as well, how each sub-SBU has performed in the DBB.

Got it. Okay.

Coming to the primary divisions, of course domestic business this year because of this ramdown, because of these two major divisions of Sparsh and CritiCare, we will be growing only at around maybe around 8% plus or minus. I'll give you exact number hopefully in the next call, but I think it's around 8%.

The CMO business is more or less the same, because most of the capacity which we have, we are trying to use for the export division. Export division is growing by almost 40%, but that base is less of around 120.

That's where that thing is there. API is, like I said, most of the APIs which we make are for in-house things.

This is where the entire thing is there. After coming now to a deep-down of all our domestic business, then CritiCare and the Sparsh, we'll see mostly like a stagnant year this year or maybe because of all these I think almost 14 plus 5, 19 plus and maybe 3 more, a 22 crore I would say correction would be there this year.

Totally, I'm saying, even including Q4. At the end of the Q4, we would be a little bit more on the same level as last year, but of course with a better debtor profile.

Infertility has increased by around 16% to 17%. Botulinum toxin has increased by almost 20% to 25%, but the base is small.

Our Ayurveda and mass marketing has grown by around 12%. This was the broad percentage.

No, this is very helpful. Thank you so much.

On your strategy of CritiCare and Sparsh, the domestic branded business, if I were to look at your debtor days and how it would impact the working capital cycle and how much would the working capital cycle fall by?

I'll tell you there are two reasons why we have to be a little bit more cautious in CritiCare and Sparsh. First is the procurement of the RM, the testing of the RM, because these are all sterile materials.

The entire working capital starts from there. The RM testing, the RM procurement, then the lyophilization process is around 5 to 10 days depending on the product, then there's a 15 days stability, then there's a transit

No, I understand the inventory cycle and everything. Because we are tweaking the

You're asking only for the debtors, you are asking?

Only for the debtors, because I just want to understand how will it impact the net working capital. Inventory and all remains the same.

Yeah. No, Avik,

you want to answer?

Let me answer. I think there's a lot of cash flow required for ramping up Indore in terms of the new products like Daptomycin and others.

For that, we don't want to go for debt and we want to go for our in-house what do you call cash generation only, and that's how we are doing that and taking it. So

Pranav, Pranav, debtor days as in because we are revamping our entire strategy of CritiCare and Sparsh because we are not giving them so much receivable days and we want to get our money faster. That is what I've understood from the call.

I just want to understand we were at close to say in FY25 we used to get money in 140 days. How far Number of days.

Sorry, Adityapal.

Yeah.

I think this question is better for Roonghta sir and Avik than me, but I'll still try to answer it.

Roonghta sir and Avik can answer.

Sorry.

I'll take this up. Aditya, as you understand, the question was only the sticky receivables in Sparsh and CritiCare.

That's the number that he is given. If you take that number and you find the number of days, you'll get your answer.

Overall the other businesses, it sort of remains the same. Going forward

Avik, let me give him a answer which I hope will help.

I will answer, sir, I will answer.

Okay. Go ahead, haan.

Last year our average debtor was around 140 days, and in '26 we are expecting it should come down to around 120 days.

120 days.

Yeah.

All right. This answers it.

Thank you so much.

Hi, sir. Just wanted to check what is the debt number as on date and what is the deleveraging plan over the next 2-3 years?

See, presently, we are having two types of loans. One is term loan, which has been taken for Indore plant, and one is working capital requirement.

Including both the loans, I can say today it is around 375 crores, and it may remain at same level at least for '27, and after '27, it will start come down. Because lots of working capital is required for whenever there is a sale jump for increasing the inventory as well as debtors.

Instead of borrowing working capital from the bank, we are making from internal accrual. Hence, we are not in a position to prepayment of the term loan, and we will start prepayment of the term loan from '28 '28 onward.

I think the loan will remain at 375 for till to March '27 also.

Got it. Depreciation interest would be at similar levels as in Q3 for FY27 as well?

It is around nine. Today, it is around 35 to 36 crore.

I think it will going to remain in the same level in next year also.

Same is the case with depreciation as well, sir? Everything is now in the business?

Everything is on.

Got it. Thank you so much, sir.

Thank you very much for joining us today. If you have any further questions, please feel free to reach out to our Investor Relations team, and we will be happy to address them separately.

With that, we conclude today's call. Take care.