Thank you, Yusuf. Good afternoon, everyone, and I thank you all for joining us today to discuss Gufic Biosciences Limited's financial results for the fourth quarter and full year ended FY '26.

The press release and investor presentation relating to today's results have been submitted to the stock exchanges and are also available on our website for your reference. Let me now begin with introducing the management team who has joined today's call.

We have with us Mr. Pranav Choksi, CEO and Director; Mr.

Devkinandan Roonghta, CFO; and Mr. Avik Das from the Investor Relations team.

We will now commence the session with the opening remarks from Avik, following which we will open the floor for an interactive Q&A session. Please note that this conference call is being recorded.

The record will be made available on our website later today, and the transcript will be shared within the prescribed timeline. Before we begin, I would like to remind everyone on the safe harbor statement.

Certain comments made during this call may contain forward-looking statements. These statements are based on management's current expectations and are subject to various risks and uncertainties that could cause actual results, performance, or achievements to differ materially from those expressed or implied in such statements.

We encourage participants to review the relevant disclosures and risk factors available in our public filings. With that, I would now like to hand over the call to Avik for his opening remarks.

Thank you.

Thank you, Ami, and good evening, everyone. Thank you for joining us today.

Before I get into the business updates, I want to take a step back for a moment because I think Q4 FY '26, and actually the full year, deserves a bit of context before we dump into the divisional performance. FY '26 was a year we came in knowing would be heavy.

We were carrying the full fixed-cost load of a new facility that was just finding its feet. We were simultaneously making a deliberate call to fix our working capital structure in one of our main divisional clusters, which cost us revenue in the short term.

We were investing significantly in the leadership bandwidth, bringing in new heads across international, infertility, aesthetics, and the hospital care platform, people whose contribution will reflect more in FY '27 than in FY '26. When you look at the full year numbers, 940-odd crores in revenue and a PAT of 63 crores on the surface, it may look like a flattish year, but the more important story is what Q4 looks like versus where we started.

Revenue in Q4 was around 252 crores, our strongest quarter ever. EBITDA came in at almost 44.7 crores with a margin of 17.7%, up from 13.2% in Q4 of the prior year, and the PAT more than doubled year-over-year in this quarter.

The sequential trajectory from Q1 through Q4 is exactly what we said it would be, and it ends in a place that gives us genuinely a cleaner runway heading into FY '27. That's the context.

Now let me take you through what actually moved within each of the divisions and business units. Indore, I want to start here because Indore has been the centerpiece of our journey for the last six quarters, and Q4 is where we close the loop on what we committed.

We told you at the start of the year that we would reach 30% capacity utilization by year-end. We got there on target.

Indore in Q4 reached its EBITDA breakeven with the capacity scaling up. What I want to flag, because it matters for how you think about FY '27, is that Indore story is now moving into a different phase.

The qualification, tech transfer, validation batch phase, that's essentially behind us. We have 40 product tech transfers complete, with another 27 under development and stability testing.

We have almost 200-plus state FDA approvals in hand. We have more than 20 Indian pharma companies that have audited or actively using Indore as the CMO base.

That's not just revenue, that's third-party quality validation of the facility and builds the foundation for the next leg of our growth. The EU GMP audit, which was also committed, was completed in the first week of December 2025 by the Portuguese competent authority.

The certificate is pending. We expect that to come through soon, and that will open up multiple EU markets for us.

Now on the international business front, the international business grew highest ever in FY '26, but the number itself is less important part of the journey. What actually changed this year is our model.

We spent several years building up an opportunistic distributor-led filing model where the distributor held the marketing authorization, and we were essentially a price-sensitive supplier. That model has its limits and ceilings.

We've spent FY '26 switching to a model where Gufic now holds the marketing authorization through Gufic Ireland for the EU market, for example, and through our own filings in key markets. We control the IP in this setup.

When you hold the MA, you monetize the asset in three distinct ways: the direct supply, the out-licensing, and the tech transfer fees. That's a structurally different and a more durable business, in our opinion.

To give you all a sense of the progress, in Q4 alone, we've received new product approvals in Myanmar, the Philippines, South Africa, Colombia, Germany, and Ecuador. We filed dossiers in 18 EU countries for multiple of our complex injectable molecules.

A major global health organization has now finally partnered with us on our most complex injectable asset, giving us access to public health procurement across 109 countries. This is the kind of partnering that takes years to build credibility for, and it tells us that international positioning is working for us.

The $824 million addressable market across select molecules in the identified geographies that we laid out in our presentation, that number hasn't changed. What has changed is the quality and structure of how we are going after it.

Now coming to our domestic business. On the domestic business side, there are two very different journeys this year, and I want to be clear about both.

The first is the working capital reset within the critical care cluster. We went into FY '26 with outstanding receivables from direct hospital billing that was sitting at almost 140, 150 days-plus, and that was simply not sustainable.

Over the course of FY '26, we made a conscious decision to shift back to CFA-led, stockist-driven distribution architecture. That transition roughly caused 22 crores in revenue impact spread across the second, third, and the fourth quarter, but we took it because the alternative was continuing to fund hospital working capital at our own balance sheet expense.

The MARG data layer we rolled out to our distribution partners means we haven't lost visibility, we've just moved the credit risk now again. The correction is now essentially complete, and we are very certain this will not recur in FY '27.

The second story on the domestic side is the genuine growth that was happening in parallel. The women's health platform, which spans our fertility and gynecology businesses, delivered its strongest year ever.

The reproductive immunology franchise in Ferticare achieved category leadership. Our gonadotropin flagship hit its highest-ever annual sales milestone.

Our new hormone introduced two years ago crossed its annual target and was ranked among the best new introduction in its segment by IQVIA in the last quarter of this year. Zenoa's power brands continued to compound, and we began building out into chronic therapy adjacencies in women's health that gives this platform a much longer runway.

On the botulinum toxin front, we are now firmly the number two brand in India, sitting at approximately 23% market share in a market where the innovator holds dominant position. We had a strong growth this year.

The more important development in Q4 is that we formally signed an in-licensing agreement with a leading Canadian aesthetics company, one that holds a significant market share in U.S. for fillers and biostimulators.

This deal fills what was the biggest gap in our aesthetic portfolio, a credible filler offering. Doctors who currently hesitate to shift their full aesthetic business to us because we offer only a toxin will now have a reason to consolidate with Gufic.

Launch preparations are underway, targeting maybe the third or fourth quarter of this financial year. The neurology side of our toxin platform, our therapeutic franchise, continued its methodical expansion into urology, ophthalmology, pain management, and neurosurgery.

This is a long-cycle business, built on guideline-driven indications where adoption, once established, is sticky and recurring. In our mass specialty nutraceutical and Ayurveda division, we continue to sharpen the portfolio around chronic themes: pain, arthritis, and GI.

Some differentiated formulation launches in Q4 includes a first-in-India formulation in our heritage orthopedic brand using an upgraded delivery format. This showed meaningful early traction and reinforced our conviction that modern formulation science applied to a well-trusted brand is a durable competitive edge.

With that, it wraps up our update on all the divisions, and I'll hand over the call to Roonghta sir for finance updates.

Thank you, Avik. I will go into highlight the financial for the Q4 of financial year '26 versus the Q4 of the financial year '25, as well as the financial result for the financial year '25-'26 versus the financial result for '24-'25.

The Q4 of the financial year '25, the top line was 205 crores. The Q4 of the financial year '25-'26, the top line is 252 crores.

There is a jump of around more than 15%. The EBITDA for the Q4 of the financial year was 27 crores.

The EBITDA for the financial year Q4 of the financial year '25-'26 is 44.7 crores. The EBITDA margin in the Q4 of last financial year was 13.17%.

The EBITDA margin for Q4 of the current financial is 17.73%. Profit before tax, Q4 of the last year was 10.8 crores.

The Q4 for the current financial year is 27.6 crores. The PAT margin in last year Q4 was 5.27%.

The current Q4 was 10.9%. Profit after tax, Q4 of the last year was 8 crores.

This year Q4 is 20.5 crores. The PAT margin has further increased in Q4.

It was 3.90%, and Q4 of this year is 8.13%. Now I will highlight the financial results for the financial year '24-'25 versus '25-'26.

The top line for financial year '24-'25 was 820 crores. The top line for financial year '25-'26 was 940.50 crores.

The EBITDA for the financial year '24-'25 was 138.6 crores. The EBITDA for the financial year '25-'26 is 152.9 crores.

The EBITDA margin for financial year '24-'25 was 16.91%. The EBITDA margin for financial year '25-'26 is 16.26%.

The profit before tax for financial year '24-'25 was 94.54 crores. For financial year '25-'26 is 85.5 crores.

The profit after tax, the financial year '24-'25 was 69.9 crores. The financial year '25-'26 is 63.2 crores.

The profit after tax '24-'25 was 8.53%, and '25-'26 was 6.72%. Thank you very much.

Am I audible?

Thank you for the opportunity, and congratulations to the whole team. It's a good set of results.

Just a couple of questions. Can you just talk about how sustainable these margins are?

Is it operating leverage playing in, or some product mix, or something that's changed? Yeah.

Hi, Pranav here. Hope I'm audible and clear.

In regard to the operating margins, as you must have seen in the last few conferences also in the quarters and otherwise, we always feel that there will be an improvement happening in the gross margins for two or three main reasons. The first reason is, of course, the business reset happening between domestic and international versus the CMO, also launch of new molecules, and also in international market upgrading to more profitable geographies.

These are the main things which will be also where, as Avik also rightly mentioned, where the most of the efforts are also being put that these continues to mature further, and there's still a huge scope before saturation kicks in. These will continue to help us to go for that improvement of 0.5% to 1% year-over-year gross margin improvement.

Understood. Also, I think in the presentation, GLP-1 validation batches was spoken about.

Just trying to understand, is this a confirmed contract or deal, or how is it working? If you can just throw some light on that?

Basically there are various drug delivery systems for the GLP-1 right now. Mostly, of course, I'm talking in injectable space, there are mostly vials and cartridges which are being there.

From the Navsari factory, as mentioned in the last few conferences, we are working on the cartridge and the pen type. Now from Indore, we have signed an agreement with another player who will be focusing on the lyophilized vial form.

We are very clear that our focus and our, I would say, play in this entire supply chain would be purely as a CDMO or a CMO, let's put it very specifically. That is where we see that we will be playing our role.

Our front-end ambitions right now are limited maybe to a couple of brands in India, but for international markets, we would be riding the wave with our partners.

Okay. Is it possible to quantify what kind of revenues can come from this, or is it too premature?

It's too premature. If you see both India and international are going to have two different roadmaps.

Of course, they will be quite, as you must have seen in the IQVIA data for the last few quarters and even before when Mounjaro came in, this is here to stay, and it's going to be growing. Maybe the margins what you see might come down, but definitely the markets will be increasing.

We see a good upside. Because, like I said, our projections never spoke about this.

This is an additional benefit which will come via this CMO operations of the organization and where our front-end partners have more of a role to play. It will be very immature on my part or very preliminary on my part to comment on the numbers.

It depends on my customers and my partners' continued efforts.

No, understood. Just a last question.

When you spoke about the in-licensing, just to understand it better, and sorry for my ignorance, but it's only going to be for India, right? Whatever we get the in-licensing, or do we manufacture and can supply it internationally, too?

The in-licensing you're referring to which particular product line?

Sorry,

the Canadian filler and

yeah.

As toxin and fillers are always go hand in hand in every aesthetic practice. Currently the in-licensing is for the India market only.

Down the line, if economy of scale comes, there are of course other trigger points which get the relationship going forward. Right now, very frankly, for the next two to three years or maximum till five years, we are looking at the in-licensing of the molecule to complement our toxin journey in the India market only.

Understood. That's it.

Thanks for that. I will join back the queue.

Hi, team. Congrats on a good set of numbers.

Nice to see the capacity finally reaching break-even. I had more of a bookkeeping question.

I saw there's an investment made into a cooperative bank of ₹6.5 crores. I just wanted to understand what is the entire arrangement.

Is this due to some regulatory requirement, and what kind of benefits do we get out of doing this investment?

Yeah. Roonghta sir, you like to take this?

I can. Yeah.

Basically, Saraswat Bank is one of the leading bank with Gufic, and we are associated with this prime from last more than 15 years. The bank has come with a proposal to allot only 24 to around 24 top customers for this year allotment as a face value of ₹10 each.

The past history of the bank is that they are giving a dividend around 15% every year. If we get a 15% return on the investment whereas we borrow the same amount at 8%, the one advantage is that we will going to earn because of this extra income of 7% to 8%.

That is one reason. Secondly, to keep the relationship with a bank, we decided to go for this investment.

Understood. What's the total exposure you all have with this bank in terms of borrowings?

I think the total exposure, including fund-based, non-fund-based, and term loan, will be around 250 crores.

Okay, 250 crores. Your interest rate you said is around 8%, right, that they charge?

In case of Saraswat Bank, one is term loan, one is WCDL, and one is working capital loan. Working capital is 8.2%.

Term loan and WCDL is 8%.

Understood. In the future, since you plan to continue working with this bank, that's why you are made this investment?

We want to continue because this bank has been associated with the group, and all the difficult times, this bank has been given a very big help to the company to grow this level. For a petty amount, we do not want to shift the bank.

We want to continue with bank. Yes, we added another bank also.

Now in a consortium banking, there is HDFC Bank, ICICI Bank, and Axis Bank.

Say, for example, once you finish banking arrangements with this bank, do they return you this investment, or does it continue to stay

on? Anytime when you want to break the relationship with Saraswat Bank, you can sell the same share to the Saraswat Bank.

They will going to return only the face value, not any premium on anything.

Understood. That's it from my end.

All the best for the coming financial year.

Hello, sir. Am I audible?

Hi, sir. I just had a couple of questions.

One is regarding botulinum toxin, what is the size of the revenues and profit for Gufic today, as of FY '26?

Sorry. Actually, I was on mute.

The total botulinum toxin market is divided into therapy and aesthetics. Totally, it must be contributing to around 3.5% plus or minus to the total revenue.

Okay. In terms of this filler, do we need to do any capex for that, or that will not be anything significant?

No,

no. As if you see in the last few calls also, currently for the India and ROW markets and emerging markets, I think the capacity has already been built in in the last four, five years.

Tomorrow, if we decide to go to the international market, specifically regulated market like U.S., Europe, or, for that matter, even for Japan or others, then there is a different capex required where also when the time comes, there will always be other options of joint investment or getting someone else in for the capex and focusing on the front-end on our own. Those were the thoughts which were explored in the past also.

In the future also, if need be, because it's a very selective and a niche thing, there will always be takers who help us to take care of the investments to joint with us going forward for the regulated markets.

Sure. Sorry, Pranav, I was asking about this fillers in-licensing, will that need any capex?

Oh, fillers. Sorry, I thought as a pillar.

Fillers. No, no.

Fillers in-license, there is no capex involved. It's a direct product manufactured in Canada, and we are importing it and selling it in India in our brand name.

Okay.

Sorry, not in our brand name, in the international brand name only. Sorry, my mistake.

Yes.

How do you see this, say maybe from 3.5% today, how do you see the botulinum toxin growth over the next two, three years?

To put into perspective, always the reason for getting them as a complement is the toxin and fillers go hand in hand, and that is where the doctors also normally feel, "Arre, if I want to use your toxin, I am getting arm-twisted with the competition when I have to use their fillers and I." That is one thing which we help that we will get the upside because of that.

Going forward also, like I said before, the total market of India of toxin and filler versus the total population versus when we compare it with Russia, Turkey, Philippines, Thailand, or any other country for that sort where the penetration also is much higher, there's still long way to go. Apart from not only helping us as additional tool to satisfy the doctor's need, the use of toxin and fillers with the help of when the Canadian company comes in, they already are the top two or the top three players in U.S.

also, it's a US FDA-approved thing. They also have the best doctors of the world, specially in U.S., in Europe, endorsing their brand.

Those will be also called as special speakers here to get the new development and training done of toxin and fillers in combination. There are certain beauty trends which are not being done by the Indian doctors can be further enhanced.

We feel that market expansion also will be helpful, at the same time of market share increase also would be there because of this relationship.

Got it. Very interesting.

Also, my second question is regarding broad guidance. If you could just give us some guidance in terms of what are your expectations of how the top line growth will pan out over the next two two to three years, and how do you see margin profile changing with the new higher exports or new plant coming on stream and operating leverage playing out?

If you could just give us some guidance on that. Also, if you could add how do you see the debt panning out over this period?

I think part of this question, I'll request Roonghta sir to help me. Before that, I'll just give you a little bit of a revenue guidance.

In terms of the debt and in terms of the margins also, then Roonghta sir will come and help me answer the remaining questions. Firstly, as I always have been saying for the past few quarters, we expect a 15% revenue jump year-over-year.

That's how, of course, the effort is for much more, but of course those are internal targets, but we feel a 15% year-over-year is something which we feel is achievable. Secondly, the gross margins, as already discussed some time ago, we expect that 0.5% to 1% gross margins improvement will always be there.

That is what we factor in for. We factor in for more because of the product mix, the geography mix, and the budgeting when we get into.

Always something like what happened just recently like the Middle East issue and there are always challenges and the rupee and the dollar equation also changing, sometimes that 1%, 1.1% suddenly goes to 0.5%, 0.6%. That's why, but I still feel on a minimum level, 0.5% gross margins will be possible.

Coming to the debt thing and the other margins, I'll request Roonghta sir to please address it.

If you see the EBITDA margin for the financial year '25-'26 was 16.25%, after the scale-up of the Indore, I feel the EBITDA margin for '26-'27 should be in the range of around 18%, and over a year, year by year, there will be improvement of between 0.5% to 1% over the year to year to comes, and it can go up to by 2030, it can go above 20%. That is our EBITDA margin.

Today, our debts is around 400 crores, total debts, gross debts is around 400 crores. Looking to the present situation, because the top line will going to increase, there will be additional requirement of working capital.

We feel this 400 crore will be the top test loan, and it will going to remain at this level only.

Got it. Thank you so much, sir.

I could get back in the queue.

Hello, sir. Am I audible?

Yeah. My question is on the slide number 12, the international business, the business model change going from the traditional distribution model to more IP-based.

How this is going to impact in terms of P&L? Will there be any change, if you can update?

There are two things to answer that. Two things are there.

One is whenever you go for this change in model, the additional cost which comes in are most important in terms of dossier and also in terms of the registration cost. Every year you see that in our other expenses also these have been already factored.

If you remember in 2023, this thought process was already initiated, and that's how when Motilal Oswal also invested with us, we wanted that cash flow coming in to ignite and to kick-start this process of having our own IP creation globally. Year-over-year, you will see, in the last three years also you have seen in the other expenses, and also going forward, you'll see in the other expenses our registration cost, dossier cost goes up.

Even our gross margins, in spite of getting the RM, PM, and the consumption done of all the consumable matter to get dossiers and three-batch filings done, in spite of them, we will see a 0.5% to 1% improvement because more and more investment is being done in terms of getting the dossier processes done. However, there's a natural improvement also happening once we move on to more countries, or we have gone from a B2B to a B2C in certain countries like Africa, Southeast Asia, or for Philippines going forward, we see those margins improvement happening.

Of course, initially there is a little bit of a cost escalation because of registration cost, because of again dossier cost, and also manpower cost, because last year also there was some expansion of manpower done for certain geographies. Again, this year we continue for having our own head office in Philippines.

We're also having a separate team in Africa which is directly working on the field on our thing. Then some other team members have been taken for Mexico to control the Central and South America.

We also are looking at a Southeast Asian market head based in the Southeast Asian market outside India. Such things will be all factored in in our expense going forward, I'm sure, leading to a gross margin improvement year-over-year.

Sure, sir. We have a slide on R&D regarding peptide and API self-reliance.

One question, currently what percentage of our raw material cost we outsource, and how these projects can change that raw material dependence? If you can tell something more in laymen terms because pharma is very technical, how the peptide and NDDS, whatever we are working on, if you can give more information in terms of laymen terms so that we can understand the opportunity for these?

Yeah. There are two types of peptide applications.

One is a synthetic peptides like a thymosin, a leuprolide, octreotide, cetrorelix. Again, I'm getting into technical part, but please bear with me.

These are peptides which are used for our gynac portfolio, our aesthetic portfolio, or they are used for our anti-infective portfolio. There are also aminoglycosides peptides which are used for our antibiotics and all that.

Somehow this peptide, I would say, foray was important for us because they complement our parent products. Also, since some years, we have gone into APIs backward integration for our fungins, for our anti-infectives, also for our antifungals specifically, also for these monobactams like avibactam, and now very soon we'll be filing our relebactam also.

The API foray is much more where we focus on, again, I'll be very upfront, that it's not that we are changing our percentage, but we are getting more and more deeper where we are importing higher key starting materials by which the value addition, let's say we were buying an item at 100, but now we are starting to manufacture item locally by which the costing goes down to 70. That is where expansion of margins also takes place, but also we become more controlling.

Right now, if you have registered some supplier's API, then you are stuck with them for some international market. When you file a dossier where you file your own API in your own dossier, then you are independent.

You can always change around the key starting material by validating two, three different suppliers from day one, then you are not stuck to someone, and the price increase and price falling down do not hold you at ransom. That's why backward integration always helps you to control the business, make it more stability, the supply is more consistent, and this also leads to margin expansion going forward.

Third thing is there are certain APIs which are not available in the market where we have to be much more upfront, so that is where the peptides market comes in. There are some future peptides for aesthetics where we feel that there are not many, I would say, dependable supplies coming in, and there are also where the quantity is also very low, and that's why not many people are interested.

However, for us, as injection portfolio, they really make sense. These are the peptides we want to be backward integrated from completely from scratch where we import the amino acids, and we completely sequence the peptide on our own so that we're not dependent on anyone.

These is the three different types of applications which help us, and that is where our thought process goes to become more and more independent. Earlier, maybe we were 80%, 85% outsourced.

Now we have come to around 65%. Down the line, we hope that 50% of our API can be done in-house eventually.

Of course, this 50% will still come from outside because the product basket expansion is also happening with new suppliers helping us.

Got it, sir. Thanks for detailed response.

Just one question. Will it require any kind of capex, or given we are done with our major capex, next two, three years you see mainly maintenance capex?

Again, our capex has been very clear that except if some strategic new thing coming in, I think for the next two years, we don't see any for-say capex. Of course, as Navsari is almost now some machines are 20 years old, some are 15 years old, some are recent.

Always there'll be a replacement capex of around 20 crores year-over-year, which will keep on happening to ensure the continuation of business. At least as of now, I don't foresee any greenfield capex happening in the next two years.

Great. Thanks, and wish you the best.

Hi. Good afternoon, sir.

Sir, my question is on the margin again. You mentioned that the Indore facility is now operating at break-even.

We are at 30% utilization, and it is operating at break-even. If I exclude that, then the margin for our Navsari business comes to somewhere around 21%, 22%.

Is that sustainable, and should we assume similar margins, say, three, four years down the line once Indore is fully ramped up?

Yeah. Roonghta sir, you'd like to take this?

Yeah. Look, Indore margin we will touch to 20% EBITDA, but over a period of time, the Indore capacity has been fully utilized.

The cost is increasing every year there is an increasing in the salary, other expenses. The Navsari margin was 20%, and because of the increasing the cost every year, we feel that Navsari margin will going to remain at around 18% to 18.5%.

Whereas in case of Indore, because of the new plant, energy-efficient plant, and large size of lyophilizer product, therefore the Indore margin we are expect around 21% to 22%. The overall EBITDA margin will be going to in the range of around 20%.

Okay. Sir, has the tech transfer for our Navsari products already happened for Indore?

It's a continuous process. Already, like Avik mentioned, most of them are done.

We are not going to take all the products from Navsari to Indore. Indore has its own complex injectable portfolio also.

However, there will be always a calendar set out for the next 12 to 14 months where there will be not only new tech transfers coming directly from the Indore R&D, from the Navsari R&D also, and at the same time, there will be some molecules from the Navsari pipeline which will also come in as we foresee some saturation happening in capacities in Navsari also. Our major focus in Indore would be the complex injectables, depots and liposomal, followed by more suspensions going forward, which will be directly tech transfers coming in from the R&D now.

Okay. Sir, where are we in terms of new launches, aztreonam-relebactam, contrast media, etc., and even on the infertility side?

How much should we expect the new launches to contribute in FY '27 and FY '28?

New launches generally, depending on like last year, we did not have any new launch, except what Avik mentioned, the HMG was there, which came in the top 10 launches of the year by IQVIA. Aztreonam-avibactam has just been launched by us this week.

It would be figuring in from the not actually in also in Q1, it will start seeing more prominent side from Q2 '27. We foresee that every year there'll be around 20, 30 crore of new launches depending on the molecules, and also there are around 5, 10 crores of molecules which we stop also, the tail-end molecules.

The net delta would be around 20, 25 crores till, of course, some I would say new blockbuster comes, which we foresee some of them might coming in in '28, '29 or '27, '28 with some special unique molecules for osteoarthritis, one for pain management, other one for infertility. These things would come with a higher delta maybe of around 40, 50 crores also adding to the top line.

Got it. Sir, do you reveal how much CMO separately contributes to our revenue?

I just did it around some time, but again I'll do it for you. Export is around 20% to 22%, CMO is around 18% to 19%, and domestic business would be around 48% to 50%, and remaining would be APIs and tenders and other businesses.

Sure. Once we fully ramp up Indore, where would our CMO business be in terms of contribution?

Right now, because of GLP-1, this year we will see this CMO business this year go a little bit higher by 1% to 2% more, maybe at the cost of domestic. It's not that domestic will increase further, but the CMO might be a little bit more higher because of the GLP-1 foray this year specifically going up.

I still say that if you see at peak also, we would be at around 40% to 45% of domestic, CMO would be around 15% to 18%, and export would be around 30% plus or minus. That is what we see at peak is our main aim, I think.

Got it.

Got it. Sure, sir.

Thanks a lot. Thank you so much.

Sir, my question is on the CritiCare vertical. Given now we have gone back from the direct hospital model, what kind of cash flow improvement we achieve?

Last year, we have lost some revenue because of that. How do you see the growth happening in the CritiCare vertical, and how do you see the cash flows shaping up?

If you can at a consolidated level, if you can say at EBITDA, what kind of percentage of EBITDA will be converting into operating cash flows?

I'll just talk about CritiCare, then I'll request Roonghta sir to talk about the EBITDA conversion to cash flow. For the CritiCare, we foresee because even when the volumes are increasing higher, there's always a price erosion which happens there.

Even if the volumes increase by maybe double digits, the growth which we are putting up this year and budgeting will be around 6% to 8% only, or maximum to 9%, except the new launch which will add to a different delta for sure. That is what is our expectation from the CritiCare as of now, assuming still the volumes would still be double digits.

In terms of now the cash flow, Roonghta sir, you can take it up?

No problem.

Basically,

the cash flow is basically depending upon the lot of factors, its collection as well as different sales. In case of a domestic sale, our collection will be around 30 to 45 days.

In case of CMO business, it is around 90 to 120 days. The cash flow generation will be around 12% to 13% of the total sales of the CritiCare division.

Got it. If we look at the incremental growth for next three, four years, it looks like bulk of the growth might come from export, correct me if I'm wrong, and also primarily from European market in case you are targeting that 5% to 10% market share, which comes around 400 to 800 crore.

The general sense is usually regulated markets, they play at a higher EBITDA margin. Given the incremental revenue ideally might come from a regulated market, do you see that also contributing to the margin expansion?

No, actually I would still say that the main delta would still come from domestic as well as international. Domestic, I was just gave you a brief about the CritiCare, but the new products launches of aztreonam-avibactam and also futures other molecules would of course added to that.

Also, you have to figure out that, as I mentioned the previous few calls, we also have the dual-chamber bags which have been launched by Sparsh. Sparsh, which is the other offshoot of the CritiCare division, also would start growing at a much faster rate because there they have two, three other molecules also launched as their inherent business changes happen as a strategy.

The IVF division, which was in double digits last year, would still continue because we have a recombinant product also being launched in the next one year. Again, in the year after that, there is one another recombinant product which is going to be launched in addition to the current portfolio what we have.

IVF also would be in domestic space growing at a decent percentage. The botulinum toxin, of course, even though the base is quite small, like I mentioned, it's around 3.5% to 4% of the current revenue, but they would be growing at a much faster rate.

This along with the ortho-gynac portfolio where we are launching some injectables which are the only one in India, first time for osteoarthritis, and, like I said, next year we'll be launching for pain management also. The domestic piece of business would continue the growth going forward.

Overall, international market of course comes with a higher margin expansion, but I see the margin expansion happening both in domestic as well as international business. CMO business is something which again I'm repeating, GLP-1 is a I would say this year, maybe next year phenomenon also, but we see that saturation coming in down the line as a CMO partner.

We foresee there'll be a static margins happening there, whereas the other CMO business, which anyway our capacity is being diverted to international, domestic market, the CMO business would also a little bit to lead to a margin reduction. That is why keeping all these three factors in mind, we still say that margin expansion happening more, but again, due to both domestic as well as international business.

Got it. I have one request.

I know we provide a lot of detailed information on all the businesses, how they are doing qualitatively, but if we can have one or two slides highlighting each business financial numbers, I think it will become easier for us to have all those slices and dices of how each of the business units are performing. That's just a request.

That's all I have.

Already, all my seasoned investors tell me, "You're giving too much information, don't give more."

Because of to complete.

I don't know, but on a lighter side, of course. If I see some merit, I will discuss Indian and I will get back to you for this point, yeah.

Sure, sir. Thank you,

sir.

I just had a question that in your investor presentation FY '29, you say US FDA and Gufic will be a pure-play CDMO partner. Could you speak a little bit more about this long-term vision with regards to CDMO and how you see this shaping up, say, once you receive approvals in FY '29, just for me to understand how the management is thinking?

Sure. As you see, US FDA is a I would say very new I would not say a new thing for us, but it's more in terms of the risk appetite, we are going step by step.

Over the years, we always I always feel, there are so many other delta of opportunities in, the rest of the world and Europe and other markets where even the IP would be more focus and we would be much better to have IP created there, which are the next growth levers. U.S.

was done simply because there were some products and some complex injectables which are available to us which we feel there's a need there. Just giving you again telling you about the timelines, we have taken some batches, there are some batches which are going to be taken in July and August, which would trigger our US FDA inspection by the end of the year once we file them.

We hope for a, I would say, inspection maybe as per their, of course, that when our clients and the US FDA, depending on their calendars, they will trigger the inspection maybe next year or something, and that's why we were confident of a 2029 or 2028 also US US operations to start, provide provided everything goes well. Again, US FDA is a very complex market, and it's the front-end risks are quite, I would say, different than what we are used to.

We foresee that for the next two, three, or four years, we want to be very clear, we want to start be as a we as a CMO, then a CDMO, where our risks are very well, defined and controlled in a black-and-white manner without going overboard, which should not affect our other growth levers of the rest of the world markets, European markets, Brazil, South Africa, and for that matter, even, Canada and, even the Far East. We don't want to compromise on that.

As well as, like I said, domestic also, we have our bandwidth quite sorted. This is our approach to the U.S.

market in a nutshell.

Understood. Also regarding the debt levels, if I'm not wrong, I heard that the debt levels would continue to be the same for the next two to three years, but I saw that even your cash and cash equivalents are also going up at the same time.

I think currently there's 70-odd crores cash on the March '26 balance sheet. I was under the assumption that there could be a scaledown in terms of debt.

Just correct me if my understanding is wrong.

I think what Roonghta sir tried to explain was keeping in mind the working capital which might be required for the next two to three years, we are confident that the current short-term debt level is enough to take care of that. Of course, the long-term debt, as you see, has been reducing year-over-year, and since there will be no more greenfield project, of course, except for replacement investment which might come, which might be part of the capex going forward, those are the only plus or minus changes which will happen.

At the same time, just to give you a small example, when this GLP-1 opportunity came up, in the last two years also, we have invested more than 30, 35 crores from these numbers to ensure that we become a suitable CMO player also in terms of machinery, in terms of validation, in terms of even certain dossier requirements also for our partners. That's why since that growth, and Gufic always has been that, always keep on investing for the future in terms of dossiers, new products, or licensing or something, we foresee that always there will be some investments done in that direction.

Like you just saw how we did it for Selvax also, or we are doing it for one more other normal clinical trial which we just in-licensed some time ago is going to cost us some 40, 50 crores, or some which is going to be a long-acting product, but a short-acting clinical trial is always 15 to 20 crores. All that also, we don't want any debt to happen.

We want it to be done from our own cash flow. We foresee that this will be the peak.

I'm sure that there will be reduction of debt, but we don't want to comment anything on that. Let it come very naturally when we don't want to compromise our growth levers just for the sake of reducing debt.

Got it.

Got it.

Sure. Thanks for a detailed answer, and wish you all the best.

Thank you.

Sir, thank you for the opportunity. Sir, I'm relatively new to the company, I wanted to understand, sir, there's a competitor called Sakar Healthcare.

Even they are into lyophilization. How are we different from them, and why do they make upwards of 25%, 26% margin?

Sir, I think you are asking me to do your job, right, sir? Because Sakar, how is it different from us, you should tell us.

Sir, from my understanding, their margins are higher than us due to a larger share of exports and oncology products. You mentioned that the Navsari facility will move towards manufacturing more export-oriented lyophilization injectables.

How should I look at the margin for this particular facility going forward? Can that delta between us and them reduce going forward?

Is that a fair understanding?

Sir, okay, I'll not comment anything on Sakar because I really don't know anything about it, but I know it's a good company, but I'll tell you, if you divide the business of Gufic, it's a domestic business, it's an export business, it's a CMO business, and APIs. If you've seen the last two to three years, most of our interest going up or our depreciation going up is where most of the investment is because of the Indore facility.

Also, till last year, the Indore cost was capitalized till the third quarter, and then you see a sudden cost increase this year, and that's the reason where you see certain costs coming in our P&L. Coming specifically to the business side of it, whenever we do an expansion, I don't know what is the lifecycle of the company there.

We are right now starting our lifecycle of the next foray of Gufic. When we have to go for the international market, the expansion of capacity, right now we have the one of the largest lyophilized capacity.

For anyone in the market who wants to create a capacity of our level, they will at least take two to three years and also to get to the level of around 1 million vial capacity in that period is very difficult. Our efforts in the last two to three years have been to not only focus and take care of the Indore expansion, but also side by side blend it with a proper dossier as well as regulatory expansion, which is seen in the other expenses, which is another load on our P&L, but it's all investments done for the future.

That's why you see even the employee cost suddenly came up because of the recruitment of now people in the international market which have taken up. Till when I was a B2B supplier around four to five years ago before Indore started, I also had a very healthy set of numbers.

When the expansion time comes, when you want to go to a particular scale, there are certain things which we need to invest in the near term to ensure your long term you're taken care of. Because at that time also what we realized that today in any country, tomorrow they find a manufacturer who's cheaper than me, they can easily replace me and get it done from them because they have a lower overhead, and my overhead year-over-year will always increase.

Tomorrow, when you go for your own product investment, your own market authorization, and you have a basket to control, your, I would say, pillar or your base is much more solid, is much more intact, and you can actually get a much better pie because the margins are much better. Whenever we in-license any new products from the international market or from our own when we do an R&D development, because every year we do almost R&D which is worth almost 10 to at least 8% to 12%, depending on the year and how the CFO gives us any budget, but we spend 8% to 10% of our top line revenue in our R&D budget every year, which I don't know how many companies of our size do that.

The IP created, our patents created are much higher. Answering your question in related to Gufic, we foresee that whatever investment was supposed to be done in capex is done.

Our dossiers, which were supposed to be done, which is an ongoing thing, but still we have reached that we have done a decent amount. We foresee the next two to three years to four years we should now reap the benefits of what we have invested in the last two to three years in terms of our other P&L and other parameters being improvement, what you investors want to see eventually.

Let's hope the next two to three years, with our hard work and my team's hard work, we can deliver, and we can get those numbers high and get those, I would say, percentages as per your requirement for which we have worked for the last three years.

Got it. Also, sir, you mentioned that gross margin improvement, one of the drivers or catalysts would be the higher share of international business in the CMO business.

Where are we on that front? Have we been able to get any orders or some kind of commitments from customers?

What kind of products are we targeting, if you could help us understand? Yeah.

Again, my reason has not been CMO for gross margin expansion. I've said that the gross margin expansion would be, of course, because of the domestic some pieces and international pieces for sure.

In terms of the international business, there are marketing authorization which we are working on where front-end business would be a little bit more controlled by us in not only in terms of tenders, but in terms of actual private markets also. This is where we see the margin expansions coming in for which we have put in people for the last two years.

There are two markets: one is, of course, the Europe, which is a tender market; at the same time, there is a rest of the world markets where it's no more tender, it's the private markets also where a field force goes and actually works in the market similar to how we have in India. Those are the margin expansion.

Also with geographies being added in the B2B market, like Europe, tomorrow maybe U.S., before that already South Africa, and Canada, and Brazil, and others, there we see the margin expansion coming in because of not only the existing molecule, but we keep on adding more and more molecules year-over-year. This is in regard to the margin expansion due to international market.

Domestic market also I explained that there are new product launches, there are IVF, I would say, toxin, and ortho-gynac, and other divisions where we're going to introduce new products, and also they are already the natural growth progression also happening by which market expansion will be done. Yeah.

Madhur, Avik here. As you read more about us, you can reach out to me.

I think there are many things to piece in Gufic. I'll be happy to take you through it as you build your thesis.

Yeah.

Perfect, sir. That would be great.

Sir, thank you so much, and I'll contact you via the email. Thank you so much, and all the best.

Thank you, Yusuf. Thank you, everyone, for joining the call.

Should you have any additional questions or queries, please get in touch with the IR team, and we will be happy to address them. Thank you, everyone.

Take care.