Thank you. Apologies for the delay.

Good afternoon, everyone. On behalf of 361, I welcome you all to the Q4 FY26 earnings conference call of Natco Pharma.

Hope everyone is in good health and doing well. On behalf of Natco today, we have with us Mr.

Rajeev Nannapaneni, Vice Chairman and CEO; Mr. Amit Parekh, CFO; Mr.

Rajesh Chebiyam, Executive Vice President, Crop Health Sciences; and Mr. Rajeev Menon, Investor Relations.

I now hand over the call to Rajesh for the management's opening remarks, post which we'll open the session for Q&A. Over to you, sir.

Right. Thank you, Hrishikesh.

Good afternoon, and welcome everyone to Natco's conference call discussing our results for the fourth quarter of FY26, which ended March 31st, 2026. During this call, we may be making certain forward-looking statements, which are not necessarily historical facts, and anything said on this call, which reflects our outlook for the future, must be reviewed in conjunction with the risks that the company faces.

We undertake no obligations to update these forward-looking statements. I would like to state that the material of the call, except for participant questions, is the property of Natco, and cannot be recorded or rebroadcast without Natco's express written permission.

We'll begin with the results highlight, and then follow it up with a interactive Q&A session. Natco recorded consolidated total revenue of ₹4,375.9 crores for the year ended March 31st, 2026, as against ₹4,784 crores for the last year.

The net profit for the period on a consolidated basis was ₹1,418.5 crores as against ₹1,883.4 crores last year. For the fourth quarter, which ended March 31st, 2026, the company recorded a net revenue of ₹816.9 crores on a consolidated basis as against ₹1,287.3 crores during fourth quarter of last year.

The profit for the fourth quarter on a consolidated basis was ₹269 crores, including the share of profit of associate, as against ₹406 crores same period last year. Net profit for the quarter and financial year includes a one-time benefit of ₹115 crores, as the company has elected to move to the new tax regime from FY26-27 and has remeasured its deferred tax assets on MAT credit and other deferred tax assets/liabilities.

For the quarter, revenue from the associate company, Adcock Ingram Holdings Limited, South Africa, was at ₹1,208.2 crores, and profit after tax was at ₹102.5 crores. Natco's share of profit based on the current holding stood at ₹35.7 crores.

Thank you, all. Now, we'll take the Q&A.

Yeah. Thank you for taking my question.

My first question is on the sales. On a YoY basis, it is much lower, I understand it's probably because of Revlimid, but did we have any impact from the West Asia war as well?

This quarter, you're saying? No, okay.

First question was, what was the impact? I think, as you rightly pointed out, there's a impact of Revlimid, that's reason why there's a decline.

The second question was, did we have an impact on Middle East? We were able to supply the product.

We had some challenges, but we were able to supply, but there's been an increase in the freight expenses because we had to reroute from our traditional carriers, but we were able to manage.

Okay. Also, our other expenses are much higher as a percentage to sales this quarter.

Is there any one-time impact of anything in this?

Yeah. Hi.

The other expenses, largely this quarter, we had a higher R&D expenses. Also, during the quarter, we had looked into some of the engineering spares and all, there was some write-downs.

Net-net, it is largely because of R&D expense and little bit because of the engineering spares write-down.

Okay. Can you quantify this?

Yeah. Engineering write-down would be around ₹20, ₹30 crores, and R&D would be the remaining.

Large part of the remaining would be the R&D.

All right. Our FY27, FY28, our tax rate would be around 22%, right, according to the new tax regime?

No.

Including the surcharge, it would be around 25%, 25.17%.

All right. Thank you so much.

Next caller, please.

Yeah. Good evening, sir.

The presentation doesn't have any guidance for the coming year.

Our expectation is, Rahul, that we should do about ₹3,400 to ₹3,500 crores of revenue. Our PAT expectation is between ₹700 to ₹750 crores PAT.

I'm making an estimate with some assumption of some increase because of the war, but again, I can't predict everything what's going to happen during the year, but we built in some buffer, but I think that's our expectation that we'll do. In addition to that, our South African associate firm should do, depending on the exchange rate, about $580 to $600 million of revenue, and the PAT expectation of that is about $47 to $48 million, again subject to how the exchange rate moves and other war-related factors.

The associate profit is subsumed in the ₹700 to ₹750 crore projection.

Sir, this quarter, did it have any substantial Pomalidomide revenue, or we are going to book it in Q1 mostly because it's a 6-month bump-up only we'll get, no, the shared thing?

I didn't see a bump, honestly, Rahul. It's fairly competitive.

We had a little bit of a sale, but nothing substantial that can make a meaningful impact on the earnings. It was a reasonable launch, but I think we launched with multiple generics, even though namesake it's an exclusivity, but I think we had multiple generics the first wave.

I think four or five guys had exclusivity. I don't know the exact number, it's been fairly competitive.

What would be the cash in books? It's there in the presentation, I must have missed it.

Just the subs. Amit, can you help me out, please?

Just the subs. Just give me a moment, sir.

Just a minute. For the year.

It's around ₹500 crores. All

right. Thank you so much.

Good evening, management team. This is Sai Surendra.

Thank you for giving the opportunity. I have two questions, sir.

Over the last several quarters, shareholders have been waiting for the meaningful value creation. Can you please explain what are the key triggers that will improve the investor confidence and drive growth in the coming years?

All right.

Your question is what are the key products for the financial year '26-27? Is that the question?

If I understand you correctly.

Yes,

sir. Yes.

Yes. I think there are two, three good triggers, Sai.

I think one is Semaglutide we have launched. I think it was generic for the vial, so that is doing reasonably well.

We couldn't launch on day one on the pen, but we could launch the vial on day one. We're able to cater to a market which is very price-sensitive.

Even though the revenue that you're getting for vial is maybe 1/3 or 1/4 of what you're getting on the pen, but in terms of market share, I think there has been a good uptake. Particularly our Brazilian sub is going to do very well.

We had a lot of first-time launches in Brazil in our oncology portfolio. These two will be the major triggers.

Of course, we will be having consolidated income coming from South Africa from our shareholding in South Africa. I think compared to the past, I think Natco has a more diversified revenue, and these earnings are without Lenalidomide.

Obviously, there's a drop compared to last year. I think the impact on our earnings is substantial, but I think in spite of the fact that there's practically no Lenalidomide or it's a very competitive Lenalidomide, we are able to generate about 700 to our expectation about ₹700, ₹750 PAT is, I think, a reasonable achievement.

Okay.

Second, FY26

was a challenging year compared to FY25. What gives the management confidence that the FY27 will be better year for shareholder?

I think see, Sai, the way you want to look at this is, I think we have always guided there will be a decline. I think our commentary has always been that we will decline.

I think you need to understand that the nature of this business is that you're going to have one-offs, and then you're going to do very well at this time. Then when there's going to be a drop, you're going to have a year or two where you want to see a dip.

Again, a larger event happens, and it's a cyclical business, and it's the nature of the beast. Because we bet on a lot of these jackpots, when the jackpot comes, then the earnings look good, or you have an exclusivity looks good.

When you don't have the exclusivity, the numbers look a dip. I think you have to take the bigger picture.

I think we have a very good pipeline for the future with a lot of exclusivities coming up. We don't have anything in '27, that's true, but I think post '27, you'll see some of these other exclusivities will start kicking in.

I think '28 onwards, you'll able to see a reasonable rise in this. Thank you.

Next caller, please.

Hi, am I audible?

Go ahead.

Yeah. Sir, quickly on the full-year subsidiary sales, what was the number?

Just the subs. Amit, can you help me out, please?

Just the subs. Just give me a moment, sir.

Just a minute. For the year.

It's around ₹500 crores.

Okay. Just a follow-up on subsidiaries.

You mentioned Brazil for the answer on the previous participant, Brazil doing well, and what about Canada and other markets? Do we expect Sema to come through this calendar year, Canada?

How probably, if not Sema, then any other products than Canada?

No, we have other oncology products which are coming through both in Brazil and Canada. Sema, we don't have a filing in Canada yet.

I think we're working on few things. As of now, no.

In the first wave, we're not there in Sema, but our oncology pipeline is there in both Brazil and Canada, and that's what is going to drive the year.

Okay. My second question is on the M&A.

Post the Adcock, we had said we are looking for one more. How is the progress there?

Any update?

We're looking at a couple of transactions.

Yes,

sure. We are looking at couple of transactions.

I think as Amit said, we have about ₹2,400 crore net cash. We're very comfortable.

We can look at one or two large acquisitions. We're looking at different things.

As of now, I don't have an update, but hopefully we'll able to achieve something in this financial year as well. Thank you.

Next caller, please.

Hope I'm audible now?

Yeah. Sir, I just wanted to get a picture on growth beyond FY27.

I get that you said that FY27 will be a muted year, but FY28 onwards, we can see a ramp-up in revenue and profit because our exclusivities are losing and everything. I just wanted to get a better picture that what kind of medicines are coming up, what therapeutic areas, and most importantly, have we already filed for them or are the exclusivities just ending at that period and being filed for them at that point and the verdict will only be known afterwards?

If you could give us a picture.

Okay. Udaya, let me answer that question.

Basically, we made a small mistake, I just want to correct that before we answer your question. Our sub revenue last year was ₹730 crores, not 500.

We just made an error. To answer your question about what pipeline do we have, I think we can't name which exclusivity is going to happen which year because a lot of these are bound by confidentiality.

We can only disclose them closer to the launch. What I can tell you confidently is that we have some exclusivities will get triggered in the financial year '27-28, and we also have some launches in Brazil and Canada in both '27 and '28, which will drive our earnings.

Both US, Brazil, and Canada will drive our earnings. These three markets will drive our earnings.

You will see the sub revenues from 730 grow dramatically. We'll also see exclusivity revenue coming from the US.

I can't name it, I apologize for that, but that portion I've answered. I think how much do we see bump in our earnings, I'd be better able to predict with time, but I think we see that our earnings should compound around 15% to 25% every year starting from '28.

So '27 will be your base year, there we'll settle around 700, 750. From there onwards, will be compounded growing around 15% to 25% depending on the level of exclusivity and how much market share we get.

I think you'll see a more stable compounding growth rather than the one-offs that you've seen in the past henceforth the next two, three years.

Okay. The second question is on the South African business that we made an investment in recently.

I get that in our overall portfolio, it helps us diversify our revenue sources and everything. From the business perspective, what is the value that Natco has for them if you could give us a picture?

Which investment? I'm sorry, I didn't catch.

Which company?

The South African investment that we'd made.

Adcock, you're saying, right.

See,

basically, you look at the world, there are about 10 to 15 markets that you need to be present to be successful. Right now, our position in Adcock is about 35%.

Hopefully, over a period of time, we'll able to increase our shareholding as and when major shareholders gives us an opportunity. I think that's the arrangement that we've had.

See, you got to look at these things strategically. You can't look at them in terms of we're only getting a see-through only on 35%, but you're in a number two company in South Africa, even and to build a company like that overnight in South Africa wouldn't have been possible without the acquisition.

In a competitive generic environment like ours, it's very difficult to grow organically. You have to grow inorganically.

Unless you do these bold acquisitions, you'll not able to acquire share and size and scale. This business now is all about scale.

You need to be present in those 8 or 10 countries, have a filing in multiple countries, and able to get scale. You might get wrong in one or two markets, but there'll be some market that will work, and then will give you the ROI on the investment.

The pipeline is going to get more competitive, and that's the only way you can build. To get share in these new markets, you have to do an acquisition.

If you start from scratch, we've seen in Brazil, now they're making money, but it's a 10-year journey. I think you had to wait that long.

I think if you want to jump-start things, you need to buy, otherwise things won't happen.

Okay. If I could squeeze in just one more question.

What is the outlook for South African pharmaceutical market in your opinion? Let's say the growth outlook for the next 5 years.

Also, let's say 5 years later, I know this is a very futuristic question, but 5 years later, at a profit level, what is the contribution we think that the investment would contribute to? Let's say, can we expect something around 15% to 20%?"

Of our earnings, you're saying? See, right now, it is if you normalize our earnings this quarter, it's about let me just take a help of a calculator, just 1 second.

South Africa represents about 22% of our earnings right now of our base earnings. It's see, there are two things, my friend.

See, one is that we always were very US focused, what we're doing deliberately now is trying to build a diversified portfolio in Brazil, Canada, India, and US so that we can get earnings which are more diversified, which is what we have achieved through the acquisition. Two, we hope now, see, we're doing a lot of new initiatives in terms of filing new products, our oncology pipeline, GLP, and all.

The benefit of that we're able to see over a period of 2, 3 years. Right now, the returns that we're getting is probably only slightly better than bank interest, but over a period of time, you'll see the benefit where you'll able to see about 15% to 20% return on capital, or even more, but it'll take time.

You had to play this patiently.

Okay. Thank you.

That's it from my side.

Thank you. Next caller, please.

Hi, am I audible?

Yes. Yeah.

My first question is regarding the other expense increase on a quarter-on-quarter basis. It's a steep jump, and as was explained some time ago, it's primarily been driven by R&D spends.

Just wanted to know what is driving this surge in R&D spends? Is it an imminent launch, which is leading to filing expenses and other things?

Secondly, is it going to be a recurring rate at which this expense is expected?

There are two parts to the question. See, you can't time your R&D expenditure.

When you start a project, you have to do it. Any R&D expenditure you do is a very long-term investment.

Nothing happens within 6 months or 8 months today. They all happen 4 years, 5 years, 7 years.

You're investing for the future. In terms of the expense this particular quarter, I think part of it is R&D, part of it also is we had an inventory write-down of certain stores and spares, engineering spares.

We had a one-time write-down. That, I think, was the reason it happened.

In terms of R&D expenditure next year, I think we expect to spend about 7% to 9%, and in terms of earnings, we have already budgeted that, and I think our PAT assumes this expenditure. You might have one quarter where you'll have higher expense, one quarter you might have higher profit, but if you sort of normalize it over a year, I think all the expenses are baked in, and the profit is after that.

Understood. Second question is there is a corresponding surge also in the other income head.

What is the reason on quarter-on-quarter basis other income is rising?

I tell you what the other income items are. Typically, there's interest income, there's PLI income and licensing fee when we do product licensing.

That particular quarter, we had some licensing income for India launch of Semaglutide, and then we had some other licensing income that we got from foreign part. These are all cyclical depending on event.

Specifically asking for this quarter, these were the major events.

Got it. Rajeev, one question which is basically regarding the Semaglutide launch in India.

You were there I think in the vial market, not in the pen market. How has been the outcome so far versus your initial expectation, both in terms of the market size that you are seeing which is forming up and evolving daily, and company's own performance in that addressable market?

It's been a very competitive launch. I'll be honest with you on that, and we couldn't launch on day one on the pen for logistical reasons.

We launched it a month later. Pen, we're getting some share, but we're doing better with the vial than the pen, but fortunately, vial we're the only generic in the market.

With our partners, Eris and Glenmark, we're able to get very good share. The run rate now, our brand is doing about ₹2 crores a month, and I think our sale, if you see, you will be having about ₹4 to ₹5 crore bump in our earnings including our partners.

You can say Semaglutide has added about ₹4 crores a month on our sale in a one-time launch quantities and all. Where do we see this number?

I think we're thinking that we should be able to do about ₹75 to ₹100 crores annualized over the year. Will we be able to achieve it?

This is our expectations. The market has been super competitive, but I think we got a reasonable good start, and I think we're able to disrupt the market.

Still the market in terms of sale, it's still with the pen. The proposition on the vial is this, okay?

The pen sells for, normalized, between ₹3,000 to ₹4,000, the vial sells for less than 1,000 bucks. There's a market who is unwilling to pay ₹3,000 to ₹4,000, is willing to pay only ₹1,000.

That market, we're able to capture. There's a play for everyone and every market, but I think that's our expectation.

That's where we are.

If I can ask one more question

if

you have time. In last couple of calls, you had mentioned about company looking at few more acquisitions.

If you have got any update on that front if any target has been identified?

We're running a couple of transactions, but again, nothing has come to a stage where I can tell you something. These are always ongoing negotiations.

When they come to a stage where we can announce, we will definitely speak about it. If the question is, are we working on transactions?

Yes, we are working on transactions. Two, are we comfortable doing a transaction?

Absolutely yes, we can do it. Anything that will strategically strengthen our core business and build geographical distribution.

At this time, I have nothing to report. Thank

you. Wish you all the best.

Thank you.

Thank you. All the best.

Hello, sir, am I audible?

Go ahead.

Any updates on NRC-2694, sir? When do you see it commercializing?

I think it's too early stage, my friend. At this time, I have nothing much to report.

Sir. Thank you.

Thank you.

Hello, sir. Good evening.

Are we looking to increase our innovative portfolio with NRC-2694? Are we planning for any other innovative pipelines ahead?

That's the only active one that's running in our internal company pipeline. The other ones primarily, I think the biggest one that we have done is we've done an $8 million investment in eGenesis.

That is probably the most exciting of our innovative pipeline. That, as you probably seen in the news, they're the first company in the world which has done a genetically modified pig kidney, which was transplanted into human being.

They have done two patients so far, and the patients were able to do well for about 6 months, and then finally they got this. They're trying to figure out what the right dose is in terms of the immunosuppression so that could take the program forward.

This probably the most exciting one, and if this will continue progress as we go along. In addition to kidney, they're also looking at liver at this time.

I think if you're specifically asking me most advanced of our innovative pipelines, that's probably my investment. I think that's the most exciting one thus.

Awesome. Are we planning for completing the acquisition in FY27, or is it going to be extended to FY28?

Acquisition, you're saying? I think we're shopping.

I think hopefully, we'll able to close something in financial year '27, but as I said, these things, until it's done, it's not done. I think if the question is, are we shopping?

Yes. Are we hoping to close something?

Yes. Have we closed anything yet?

No. I think that's where we are.

Yeah. Thank you.

Next caller.

Hi, yeah. I just wanted to ask if you have any tentative milestones for eGenesis business?

Tentative milestones?

Yeah.

I think once they start doing more patients, and then once they get an idea of what's the right immunosuppression dosage, I think one thing is clear, the fact that the transplant works and the patients are able to do well for about 6 months, itself is a very monumental achievement. I think the scheme of things, if you just think that you're able to transplant an animal kidney and put that in a human, and human being is able to do well for a few months is a absolutely monumental thing.

The question now is what's the right immunosuppressant dose which will make it work, I think is the question that they're grappling with. If they have an answer to that question as we keep dosing more patients, I think then you have a breakthrough.

I think that's the question that they're trying to answer. That only time will answer, hopefully.

Do you see that happening in over 3 years, 5 years, anything?

I think they're trying to recruit more patients. I think my understanding is that they will going to do more transplants in the coming year.

I think in the next 12 to 18 months, I think we'll see more transplants, and then they'll have greater experience in terms of what's the right way to handle these patients. It's absolutely exciting work, and this is absolutely breakthrough work.

This will change science in a big way. I'm personally very excited, but these are all moonshots, as you know.

These have reasonable amount of risk, but if you get it right, that $8 million is worth a lot of money. I think that's where it is.

Okay?

I share the excitement. When do you see the sales coming to the top line, any timeline or what's the quantum that you

I can't tell you something that even I myself have no idea about. What I can tell you is see, that's what happens with NCEs.

I think you need to understand that when you do these things, it's a binary event. Either you will hit it or otherwise it won't happen.

You just have to be patient and we'll give you patient updates based on whatever we hear. They also update their websites regularly and tell about all the major breakthroughs that are happening on the breakthrough events.

You just have to be patient. Hopefully, in 12, 18 months, they're able to get more breakthroughs, which are more exciting, then I can come back and report to you.

We just have to be patient. That's how it is.

Got it. Thank you.

Thank you.

Thank you for the opportunity. Sir, I wanted to ask you about our Crop Sciences division.

I wanted to understand this division, the industry, if you can give any color on that and our business.

That's a good question. I think my colleague Rajesh will answer, and he will also tell us about our demerging process as well.

Rajesh, can you speak, please?

Hi, Neeraj. As you're aware, we're in the process of demerging the business, and one of the primary reasons we felt also, it gives a more focused approach because the business, ultimately, the customers are quite different.

See, one of the key things we are pursuing as part of our approach is, again, trying to find molecules which are a little differentiated from most of the other players, and the approach that we have taken towards pharma, right? Products which could be unique, which could be patent-controlled, limited competition.

That's the approach that we're taking. We have slowly building on overall presence in the market, right?

It's been only 3, 4 years of our commercial presence, actually. The first 2 years has been mostly learning in terms of how the market works and all that.

We believe that once you have a very strong product and with the right offering to the farmers, I think we can do wonders. In terms of sale, let's say, this year, we ended up close to ₹140 crores, right?

As opposed to declared number for last year was about ₹60 crores. From 140, we certainly have aspirations to grow significantly well.

It's also being driven by product launches as well as the penetration with the channels, okay? The channel partners that we have, as compared to most of our peers, is still less.

Both products, channels, and also the people additions, all these activities are going on. I think we're fairly confident going forward, and that's also one of the main reasons for demerging and having more focus on the business.

Is that good?

Thanks. That's all from my side.

Thank you.

Sir, follow-up question is regarding the Semaglutide pens. I don't see any media or advertisement about the pen launch.

You said you've already launched it?

We launched the pen. We said that when we did the announcement, what we said was we're going to launch next month.

I think we launched the vial in March, and we said that we'll launch the pen in April. I think that's what we announced.

Actually, when the launch happened, we didn't announce again. We thought it was covered in the earlier press announcement.

We're not first launch, we're not there on day one, I think that's the reason why we didn't make so much noise. Typically, when you're day one, you make more noise and make the announcement.

The vial was on day one, so that's why we announced it, and we made a little more noise about that.

Okay. Are we selling it through the digital pharma platforms, like Tata 1mg, PharmEasy or it's

Exactly I don't know. I think they go through different channels.

I think there have some digital platforms are also selling our products, but yeah, I think we have but again, they're all required prescription and all, I think what the drill is, but Because

I'm using oral Rybelsus and I'm a Natco investor, I feel very sad when I have to buy that, and I can't find Natco's products here in Guwahati, so that's

I understand that there are challenges with that as well. I think of the products that we are having in the Semaglutide portfolio, our vial has done better than the pen, I think, clearly.

I think that's where we had success.

Sir, just one last follow-up question. Sir, we are 100% in control of what we do, that is our company, and we are going to have a pretty, what do I say, subdued year ahead

as per your own Yes, truly, yeah.

We have a lot of cash, are we not at all open to buybacks at a certain price point, because No, Rahul.

No. You asked me straight question, I'll give you a straight answer.

No. I'll tell you the reason for that because my personal belief is this cash should be used for an acquisition, which will give us more long-term return.

I think there are opportunities where we can diversify our portfolio and build a strong global footprint company. The last few years have been great, but they have been very because of our concentrated bets.

I think we need to evolve into a more diversified bet and as a firm, so that gives you more stable earnings. For that, you need to do acquisitions, and that's, I think, a superior use of our cash.

Buyback can also be considered as the right time, but at this point, no. My thinking is that let's spend money on acquisitions.

Sir, just for this acquisition that you are planning or targeting, you must have zeroed it down to a specific geography by now, or is

I can't answer that question, Rahul. We're looking at different deals.

When it comes to a certain stage, we'll talk about it, not at this time.

Within the country as well or all outside?

I'm actually bullish outside India. I'm not bullish in here, I think valuations outside India is more reasonable compared to

Okay. Thank you, sir.

Next caller.

Hi, am I audible?

Please

go. Yes, you're audible.

Quickly this question is to Rajesh. Given the West Asia war and the subsequent cost inflation, what would be the impact on our agrichem business?

We have seen a lot of peers in the agrichem specialty chemical business talk about

cost Impact on what? Can you please repeat?

Your voice

broke.

The war? How the war impact on the agrichem business is Yeah.

See, one of the things which Rajeev also mentioned earlier, the input material costs are going up, right? We have already seen 25% to 30% increase in the input raw materials.

See, I think even industry, fortunately, most of the procurement for the kharif, at least half of the procurement has already been done. With that inventory pre-existing, we are able to still manage at a price, but going forward, it is uncertain.

I think that there's likely increases of prices as well. We are closely monitoring the market and the competitive behavior as well before we make our decisions.

I think pharma is a little more different. I just want to clarify that.

Like pharma, I think, even though there's been increase of some inputs, we have reasonable amount of inventory, the impact of that you'll not see in June and August quarter. You might see it in the later part of the year.

The exchange depreciation also sort of kind of offset some of the increase of raw materials. I think net-net, there is an impact, but At least the export business has not been relatively less impacted than the domestic.

I think you see anybody who is doing export relatively the impact has been less compared to the people who have exposure to outright domestic business. The agrichem business will have more impact because the exposure is high on domestic sales.

I think as a principle, I'd like to tell you that export business is definitely less impacted. Okay.

Sure, sir. Thank you.

Just a follow-up on that, have you commenced your exports? No,

for agro business is very small. Mostly, it's domestic.

Yeah.

Predominantly, domestic only.

Okay. My next question was just as a update on the plant status.

Can you just provide an update on all the plants?

You're breaking up. Plant status?

You're talking about the pharma

US FDA, US FDA status on all the plants.

Okay. We have four US FDA facilities in our system.

We have two API plants and two finished dosage factories. In the year 2025, we had inspections in three of them.

Kothur, which is our formulation facility, Chennai, which is our API facility, and Mekaguda, which is our API facility. All three got inspected, and all three got cleared, and we got EIRs.

Vizag is a facility that has not had an inspection, I think, nearly I think I would say long time. We're expecting an inspection sometime this year at any moment.

Vizag is the only one which is pending. Otherwise, the other three has been inspected in 2020 at the last financial year, '25-26.

Thank you. That's all from my side.

Thank you.

Thank you so much for the opportunity, ma'am. Am I audible?

Yes, you are. Go ahead.

Sir, I would like to ask a question that you have planned many expansions in foreign countries, what would be the gestation period of that, and when can we see the returns on the P&L?

I think Brazil, we're seeing right now. Canada has been stable.

US, which has got us strengthened about few years ago, still is losing money, hopefully this year we'll able to break even. South Africa, we just invested.

The value of that, I think, in my personal view, will take about 3, 4 years before we start seeing value of where we are. Every business has going through a different phase.

Indonesia is still losing money. We're going to catch up.

I think, see, if you start from scratch, it takes 5 to 7 years to build a business. You buy something, then it takes probably 2 to 3 years before you start seeing an outcome.

Everything is a very long gestation, because just a regulatory approval on product takes 2, 3 years, I think that's how the cycle works in our business.

Sir, just a follow-up question. We are doing this as a strategy for US plus other countries, right, to diversify the whole portfolio and not be dependent on tariffs?

Not be exposed to tariffs?

I think you look at our earnings today, I think our earnings primarily come from four markets: India, US, Brazil, Canada, and now South Africa through our associate. I would say five countries.

Earlier, it used to be only US. Now we have five.

These five countries are giving the base profitability now. I think that's a pretty good diversification that we have done.

This didn't happen overnight. It has been about the last 6 years of diligent investment in R&D and filings and market access and launches and manufacturing, I think you're seeing the fruits of that at this time.

Okay. Sir, this is last question from my side.

Over the last years, we have seen stupendous margins, about 40% to 50%. Do you see that as being stable, albeit contracting or expanding in the future years?

I think we have given guidance. I think we said it's going to decline, so as I said, there'll be a dip in our earnings this year.

Last year, March, obviously, we did for ₹1,400 crores PAT, as you're aware. It's going to drop by half, I think we will see a contraction for sure.

We're going to drop to about ₹700, ₹750 this year. Things will turn around, but as of now, yeah, to answer your question, yes, there'll be a dip.

Okay.

This was all from my side, sir. Thank you so much.

Thank you.

Sir, am I audible?

Please go ahead. You're call.

Sir, my question is that is there any chance the company will get a sustainable and stable profits in the future because we cannot endure this rollercoaster like revenues and profit dips?

See, Manohar, let me answer this in a way that you're comfortable. See, the nature is you need to accept that certain businesses are rollercoasters.

I think our communication has been very clear that you're going to have a couple of good years, then going to have one or two years where it's going to dip. That's the nature of this business.

When we have the upside, the upside is very strong, and you have extraordinary amount of margins. When things dip, normalize, you're not going to have, and that's the nature of this business.

I think as an investor, you need to sort of accept that you're going to have this rollercoaster ride. The best thing I can do, Manohar, is tell you that this is a rollercoaster ride, and this is how you need to pair your expectation.

This is how it's going to be, and I'm sorry, I don't have a better answer to that question, but that's how it's going to be. However, having said that, I have been very cognizant about avoiding volatility, and I think that's why we have done all these investments like South Africa and build this front-end in Brazil.

Still, in spite of the volatility, we're able to maintain a pretty good profitability, and we're doing about whatever we projected this year. It is the way it is.

Yeah. Okay?

Thank you.

Another question is, sir, that I have been following this Natco company and you for more than 2 years for now, and you have been very honest with your answers. Is there any chance or your intentions or plans to become Natco to be a Dr.

Reddy's or Sun Pharma like company?

I always aspire for that, Manohar. I always believe that, but thing is, see, true success only comes if you're willing to play the game for the long haul.

I'll give you a very honest answer. If you want great things to happen in the next 5 years, you got to invest for the long term, which means you need to have the ability to ignore short-term earnings volatility.

Because when we're investing in something, we need to believe that this investment will work, and it'll take 3, 4 years for it to pay off. I believe we can build a global company.

I think that journey has already started, and I think our investment in Adcock proves that to you. I think if you look at Adcock and Natco's turnover together, I think we have passed this year, almost touching now more than a billion dollars in revenue.

I think in that sense, we've really built a global company and all with very modest amount of money that we have had. We're able to build these jackpots and use this money to buy these assets.

I think you just have to be patient. You're going to have one or two years of difficulty, but in the long run, we'll able to build a stable.

Thank you. Next caller.

Hi, Rajeev. You can hear me.

Rajeev, for the year, if you can just give us a sense on how many filings and all have you done on the R&D side? Any good filings that have happened, and how are you looking for R&D program for the next year?

I think we've done about seven 7 to 8 filings in the US, and really good ones, we didn't hit any major first-to-files. Hopefully, this year, we're trying another eight, nine, trying to target some couple of complex and first-to-files.

Hopefully, we'll have one or two this year. I think that's our expectation.

Just to probe that further, the fact that this year, you didn't have any major filings, and that is a consequence of what? Some programs didn't play out as you expected, or just higher competition than what you expected at the filing stage?

More competition.

Just more competition. See, generally, in the line, the products that we file and they're like seven or eight guys, we just don't talk much about it because it is a commodity filing.

The only special ones are the ones where you're going to be the only one or there's limited amount of competition. US is a winner-takes-all game, right?

Especially if you're doing an NCE-1, chances are most products you have 8 or 10 or 15 or 20 guys who file on day one. Those, there's not much.

Where do you make money? You have to file where nobody else nobody else files, or two, you identify something where nobody has filed, and and suddenly you file, and you're first to file.

Those are very few and far between. If you're able to pull off in a 3 to 4 time year time period, you're able to pull off even three of those, you have done a great job.

I think you just have to be patient. Nitin, I with the ball, we are on the ball.

I think hopefully, we will pull off another two, three. We pulled off enough.

Look at our pipeline staring at the investor presentation. We have FTF on, on Erdafitinib.

We have approval in 30 months. We have Olaparib.

Hopefully, we will have 30 months on that sorry, exclusivity on that subject to FDA clearance. Then we have filings of Semaglutide.

We have filings, if you've seen the pipeline. We have Carlizimab, we have FTF.

Trabectedin, we have FTF. We have some, and I think hopefully, we'll able to build a pipeline for another three or four.

Then we have something for something to talk about for the next 7 to 8 years.

Right. Secondly, if you can give us some more sense on the size of the businesses in Brazil and Canada, and how do you see Brazil, Canada, and some of these other non-US markets playing out for you going forward?

I think our Brazil turnover of our sub this year was about ₹257 crores, plus I think we have some billing directly from India, maybe that is about ₹30 crores, I don't recollect the number, about 280. We are expecting that business should go to $55 to $60 million this year, so that is one big bump we're seeing in our numbers.

Canada, which we are expecting will grow around 10% to 15%, it's already a fairly comfortable business. We have a couple of big launches, but that's in '27-28, not in '26-27.

That's one. Then obviously, South Africa is going to get added.

I think that's where we are. These are the major ones that are driving.

Sorry, what size you did say the Canada was this year?

Canada this year is ₹229 crores.

Okay. Thank you so much.

Thank you so much. Thank you.

Hello, sir. Thank you for providing out the opportunity again.

You mentioned that from FY28, we will be seeing our growth. Can we expect the approval for those cancer pipelines that we are planning to launch in Canada and Brazil by H2 of calendar year '27?

I think the products we're going to launch in '27-28, when are we expecting approval, is that the question?

Yeah. When are we expecting the approval for those medicines, is it within the H2 of FY27?

Yes, H2 of '20 financial year '26-27, we're expecting approval. Based on that, we expect the earning impact will be in '27-28.

Got it. My second question is, what is the expected revenue contributions from those medicines that we are launching in Canada and Brazil?

I think the expectation is that we have already spoke about Brazil should do very well this year. I think we said that we did about little less than ₹300 crores this year Brazil.

That will go to probably $55, $60 million this year. That's our expectation.

That is the biggest bump that we're seeing. In terms of revenue-wise, what we're saying is that we will see our earnings settle around 700, 750 this year, and we are expecting '27-28 based on our pipeline that we'll able to grow around 15% to 25% on the PAT.

Thank you for the answer, sir. Yeah.

Thank you. The next caller will be my last question.

Thanks so much.

Yes. With the acquisitions that I'm seeing and the strategy that Natco is going to take for the longer term, like you mentioned, more stable revenues and earnings, right?

Going ahead, what sort of split do we see in a, say, the jackpot kind of business and the stable kind of business, if you could throw some light on that?

This year is all driven by the base business. We don't have any big launches this year.

No, not this year. In the next 5 years, that sort of timeline.

I think some of the exclusivities will kick in. I think the biggest one, obviously, Semaglutide.

I can't tell you which year we're expecting launch, because they're all bound by confidentiality.

No, I mean the acquisition that we have done, so that is to bring more stability, right?

The

Natco's legacy is a jackpot kind of place, if you get me, right?

So You're right. Sure.

In that sense, where do you see Natco in the next 5 years? Like the stable part percent and

I think in the next 5 years, our vision is that we are able to build a global company which has more geographical diversification and bring less volatility in our earnings. However, having said that, if you look at the business today, we don't have those special complex filings, your earnings are not coming.

There's no earnings. You look at any of our top companies.

I don't speak for myself, I speak for any other top peer companies. If you remove the first-wave generic launch or the complex generic out, the earning contribution of these products is representing about 50% to 60% of their earnings or 70% of the earnings depending on which company you're talking about.

I think what we can strive to do is to bring about less volatility in earnings. If I say in an ideal world, I would want our base revenue to contribute 70% of our profit, and the first-to-file or special product to contribute 25% to 30%.

Earlier, the ratio was the other way around. I think that's what we're trying to correct so that we can bring less volatility.

That is the objective in the next 5 years.

Answers

your question? Yeah.

Yes. Yes, yes.

Thank you. Thank you so much.

Thank you, all.