Thank you. Good afternoon, everyone, and welcome to Neogen Chemicals Q3 FY26 earnings conference call for analysts and investors.

Today we are joined by senior members of the management team, including Mr. Anurag Surana, Non-Executive Chairman; Dr.

Harin Kanani, Managing Director; and Mr. Gopikrishnan Sarathy, Chief Financial Officer.

We will commence the call with opening thoughts from the management team, after which we'll open the floor for your questions. Before we begin, a standard disclaimer: certain statements made or discussed on today's conference call may be forward-looking.

Actual results could vary from these forward-looking statements, and a detailed disclaimer is available in Q3 FY26 earnings presentation which has been uploaded on stock exchange websites. With that, I would like to invite Dr.

Harin Kanani to share his perspectives. Thank you, and over to you, sir.

Thank you, Nishit. Good afternoon, everyone.

Thank you for joining us to discuss our third quarter fiscal 2026 financial results. I trust you had the opportunity to review our investor presentation.

I will provide a summary of our operational performance and an update on our key strategic growth initiatives. Q3 served as a period of steady recovery and a decisive pivot towards a future-ready portfolio for Neogen.

Despite global market volatility, our core business remains robust, underpinned by demand resilience in pharma, flavors and fragrance, and other specialty applications. With our product optimization initiatives at the Dahej replacement plant nearing completion, we are firmly on track to achieve our growth ambitions.

Before our CFO provides a detailed financial overview, here is a quick summary on a consolidated basis. We delivered 9% revenue growth in Q3, with a gross profit up 13%, with around 150 basis points margin expansion.

While top-line growth was strong, EBITDA and PAT were pressured by transient costs related to Neogen Ionics ramp-up, elevated operational expenses due to fire incidents and interim toll manufacturing setup, and higher finance costs from Dahej plant reconstruction and other investments. These are short-term impacts as we pivot to a future-ready portfolio.

Furthermore, at least part of the eligible costs will be recovered through loss of profit insurance claims in the coming quarters, mostly in the next financial year. Regarding the fire incident, we received INR 83.48 crores in insurance claims till nine months FY26.

Accordingly, net claim receivables stands at INR 251.12 crores. We are maintaining a close dialogue with insurers to expedite the final settlement of the remaining balance.

Concurrently, construction of and replacement plant of Dahej is progressing rapidly, with commissioning on track for Q1 FY27. We are confident this new facility will be fully compliant and optimized for enhanced operational efficiency.

Moving to update strategic expansion initiatives on battery materials, strategic Indo-Japan alliance for electrolyte salt production, we have successfully concluded a joint venture with Japan's Morita Investment Limited to produce and sell LiPF6 salt globally. Neogen will hold an 80% majority stake in the new entity, Neogen Morita New Materials Limited, supported by a $20 million investment from our partner for the rest of the stake.

The JV integrates 30 years of proven Japanese technology to accelerate international customer approvals and production efficiency. Notably, this establishment is India's only non-FEOC compliant electrolyte salt plant with proven established technology, offering a strategic alternative to Chinese supply chains while advancing Atmanirbhar Bharat through significant import substitution.

To give you an update on our Pakhajan greenfield project, our Pakhajan greenfield project is progressing on schedule, with commercial production for electrolyte targeted for H1 FY27 and electrolyte salts for H2 FY27. This timeline is strategically synchronized with India's ACC battery rollout and the surging global demand for non-FEOC compliant supply chains.

At the facility, plant equipments have arrived, assembly is currently underway, and trial production is expected to commence shortly. We have already achieved a major milestone by securing long-term commercial supply approval from a prominent gigascale Indian manufacturer following successful PPAP completion.

On the international front, we have received provisional approval of our lithium electrolyte salts from multiple global clients now, while final site audits are expected to be concluded in Q1 FY27. Upon commissioning, Neogen will emerge as highly cost-competitive global source for lithium salts and electrolytes backed by proven Japanese technology.

We are currently seeing significant tailwinds from the US 45X tax credits non-FEOC requirements and recent price volatility in China, both of which enhance our appeal as a strategic global partner. We expect several large-scale international customers to finalize their approval process shortly, paving the way for bulk consignments and regular commercial production in H1 FY27.

Looking ahead, we are at a pivotal inflection point as we transition from project execution to the commencement of regular long-term supply agreements. We are confident that Neogen Ionics will become the cornerstone of our future growth, diversifying our revenue streams and enhancing our margin profile.

By integrating world-class Japanese technology with our indigenous manufacturing excellence, we are enforcing Neogen's position as a technology-led leader within the global battery chemicals value chain. As the electric vehicle and energy storage ecosystems evolve, our readiness to supply material at scale positions us to capture substantial market share, delivering long-term sustainable value to our stakeholders.

That concludes my opening remarks. I will now turn the call over to our CFO, Mr.

Gopikrishnan Sarathy, to provide a review of our financial performance for the period. Over to you, Gopi.

Thank you, Dr. Kanani.

Good afternoon, everyone. Welcome to Neogen Chemicals Q3 FY26 earnings call.

I will share the financial highlights. Please note all the numbers are on consolidated basis.

Our revenue for Q3 reached ₹220 crore, representing 9% year-on-year growth. This was led by higher volume across both organic and inorganic chemical segments, reflecting a steady market demand.

Notably, we maintained resilient operating volumes despite temporary capacity bottleneck at our Dahej facility. These were effectively mitigated through strategic toll manufacturing arrangements.

Additionally, Neogen Ionics contributed ₹12 crore to the quarter's revenue as we continue to scale our battery chemicals vertical. Breaking down our performance by segment, organic chemical revenue reached ₹187 crore, a steady 6% increase in year-on-year.

Our inorganic chemical segment showed even stronger momentum, delivering ₹33 crore in revenue, a 35% growth compared to the same period last year. EBITDA for this quarter stood at ₹32 crore, demonstrating sequential resilience despite several transitionary headwinds.

On an year-on-year basis, our performance was impacted by temporary cost factors, specifically the operational overheads as we scale up at Neogen Ionics, and following the Dahej fire incident, the additional interim toll manufacturing expenses. This was incurred mainly to keep the customer supply on during the plant reconstruction.

We view this short-term cost essential to protecting our market share and preparing our future growth. As highlighted by Dr.

Kanani, the near-term pressure from these transitionary costs will be balanced by insurance claim recoveries under the loss of profit policy. We reported a profit after tax of ₹4 crore for the quarter.

Year-on-year variance is primarily attributable to the increased interest expenses related to our capital expenditure at Dahej, alongside the front-loaded expenditure at Neogen Ionics as it prepares for the large-scale commercial production. Turning to the corporate update, reflecting their deep confidence in the long-term growth trajectory, board has granted in-principle approval to raise up to ₹150 crore via preferential issue of equity shares to the promoters.

This infusion underscores the unwavering commitment to Neogen's expansion and provides financial flexibility to accelerate our growth initiative. This preferential issue is subject to the necessary regulatory approval.

That concludes my remarks. I will now request the moderator to open the forum for Q&A.

Thank you.

Good afternoon. Thank you so much for taking my questions.

Could we please just start with the update on the gross and net debt balance at December? Also, give some color on the working capital trends.

It does seem like the inventory DSOs and receivable DSOs have increased during the quarter based on the numbers given at the back in the tables. Just what exactly were the reasons for these and what our outlook is for improvement on that front?

Hi Abhijit, thanks for your questions. Yes, there's a increase bit in the inventory as well as for in terms of receivables.

I think the receivables is basically in line with the increase in the business, and overall what we expect, as we've said, that this year the debtors and the creditors, as we said, will be more or less matching each other. In terms of inventory, there'll be a little bit of increase this year because right now we are working in multiple external vendors, and we also want to build in a little bit of inventory because we want to stop the external vendors by end of the year, and we want to start internal production in Dahej in the first quarter.

When we start internal production in the beginning, the plant is ramping up, so that is the time where we want to ensure that even if there's a slight delay in production or ramp-up, our customer needs are taken care of. We are building up a little bit of the inventory by end of this year so that we can take care of the next quarters.

I think as our Dahej plant starts and streamlines in the second half of the year, inventory should come online, and we maintain our target that once we have a full utilization in the next financial year, by end of next financial year, our inventories would be at around 140 to 160 days is what we are targeting on the inventory side. As we said, debtor, creditors, usually, depending on whether more international or more domestic sales, the debtors are usually between 60 to 90 days kind of a range by end of the year, and that's what we would like to target.

Generally, debtor and creditor levels, we will try to keep at a similar kind of level.

Thanks, Harin bhai. Just the gross and net debt numbers if we could share at December end?

Maybe, Gopi, do you have those numbers directly with you? Okay.

Hello? Which numbers you are saying, sir?

Just the debt numbers.

I got the number here. Net debt that we have today is around ₹680 crores on standalone basis and around ₹1,150 crore around ₹1,175 crores on a consol basis.

Got it. Thank you.

Thank you for that. Second thing, just on the receipt of the money from Morita towards their 20% stake in the JV.

By when do we expect to get that? Also this ₹150 crore pref allotment to the promoters, by when would that money be expected to come in?

There are four non-business flows which are non-operation flows which are significant which are coming. Let me share with you that.

On the insurance front, we are very close to getting another ₹60 crores as a second interim payment against the rebuilding against the capex loss. That is expected within this week.

It was actually supposed to happen, but there was just some last-time procedural issues at between the insurance companies, which slightly delayed. We are expected around ₹60 crore within this week.

The main stock claim, between ₹150 to ₹170 crore, is expected before end of March. That's around ₹210 crore, which is going to be expected here.

In reference to the $20 million which we are expecting, we have to basically request our bankers because the entire project was part of one. Now we are taking the bank's permission to separate it out as two different entities.

That is in progress. As soon as that is received, we can complete the rest of the formalities, transfer the asset to the subsidiary Neogen Morita, and then we can receive the equity from our partner.

That will be towards the end of current quarter, and depending on the final timing, maybe either this year before March or a little bit in April. Basically by Q1 we should receive money from there.

Finally, the ₹150 crore by the promoter. Our intention is to basically put the money before end of March.

However, there's some regulatory approval which is needed because there were some transfers during trust formation from my father and mother to the respective trust. We are just seeking a clarification.

Depending on the regulatory approval, either it'll happen before March or it will happen in Q1. In the worst case, by Q1 next year, we would have ₹150 crore from the promoter, we would have around ₹200 crores from the partner, as well as you'd have at least 200-odd crore from insurance.

We expect around ₹550 crore to come either in this year or in Q1 next year.

Understood. No, that's very helpful color.

Thank you for that. Just a last couple of ones if I may, if it's not too much.

One is on the salt order receipts. Obviously, I think in the presentation and your remarks, you've mentioned that things are moving well and we are somewhat close to receiving the order.

If you could please just put some more color around it, exactly what the status of things is, and yeah, by when we expect to see some meaningful shipments happening there?

As we said in our opening remarks, that, a lot of people have shown very strong interest, right, where both like, in the regulated larger customers as well as non-regulated, like, who guys who will buy just one time or two times or something like that. Tho- those those sales have already increased, and that's why you can see the like smaller, but like, in terms of value-wise significant increase in terms of our year-on quarter-on-quarter kind of sales increase on the salt business.

However, like, the for me, the biggest important point is that while we have one customer with whom now, we have completed the majority of the requirements. They have now started working on the final timelines for the approval.

As we had said, we'll expect that by Q1 that to happen. In parallel, three to four other customers who, as we had said, discussed earlier, have already started taking samples, or some of them have started approving our samples.

Because of what is happening in lithium, even our intermediate like, the simple lithium salt, also we have received very strong inquiries. We feel unfortunately, just the approval cycle is such that some of these have already approved our samples, they plan to do audits, let's say, in the month of March, April, May, and then maybe if we have something, to basically do some corrective actions based on that.

We expect by June our Dahej site should get audited and approved. By that time, as you can see, majority of our capacity also will be coming online.

That like, once these capacities come online, from Q2, Q3, Q4, we can see good salt related revenues coming from Dahej. In case of Pakhajan also, we are trying to speed up the salt so that like, by Q2 financial year, by September, is when we said like we've said second half, but we want at least trial production to start in first half, so that we can start the validation process, and maximum by December we try to get the Pakhajan site also approved so that we can take the maximum benefit of the 2027 requirement.

I would say Dahej site should be fully qualified through several customers by June, that is Q1, by end of Q1, and sales should start in Q2. Pakhajan we are targeting in the second half, but our target would be to complete it by Q3 so that it starts contributing in the sales from Q4 in the next financial year.

Just on the capacity addition slide, the 1,100 tons to be commissioned at Dahej, the timeline is now mentioned as March 26. I believe last quarter it was December 25.

Any particular reasons for some of the shift of three months?

Basically, our team had a training session with Morita team. Our team actually went to Morita's plant team and had a hands-on training session.

During that, they picked up some of the improvements which we could further do. We are basically implementing that.

Majority of it is almost ready. We also had one of the other plants, we also had some slight design change which we carried out in the additive production part of that.

I think just that some changes in that design for further improvements, that we were implementing, it went March. Anyways, still we have not received the approval, we felt it is good to get them done now rather than start and then again stop.

That's the reason why we decided to complete them now and complete the expansion by March.

Thanks. Just one last thing from my side, Harin bhai.

The one is, there was some news articles recently regarding the fact that one of the largest potential customers of yours who could set up battery capacities in India have kind of put their plans on the back burner because of lack of Chinese know-how or technology that they could source. Any thoughts on that?

The other thing, just to add in quickly, bromine prices have been very strong in recent times. Has that had any impact on our business in terms of realizations and is it possible to just break out the volume versus price for this quarter for organic and inorganic?

Thank you so much.

Sure. First, about maybe specific customer which you mentioned.

See, we have not received any such communication from the customer, and we basically continue to discuss with the customer how we can meet their demands, and those discussions continue. On the second side, on the second point about bromine being strong, majority of this has been See, again, it's not a very big difference, but I know, for example, in case of lithium, in case of organolithium, we have a slight volume increase, and in case of organic derivatives, it's very difficult to give you volume because the product mix changes quite a bit.

Overall there is a volume growth, yes, but because of the product mix, really that volume growth doesn't tell you too much. Specifically with regards to bromine prices remaining, it's not changed too much of our business because usually majority of our bromine is contracted for a longer period of time, and with our customers also we have contracts, basically from one contract to another it kind of get material.

Unless you have like a 2 times, 3 times increase in bromine, we really don't see a big impact related to that.

Thank you. Thanks a lot.

All the best.

Thank you.

Good afternoon, Dr. Harin.

Thanks for the opportunity. My first question is, I'm just reflecting back to our commentary in the previous call that you said that some of the last stage of approvals for the salt, your customers will be visiting your facility in Jan-Feb, or online, and then their final approval.

Now we are once again talking about the timelines three to four months down the line. May we just understand why this repeated delay in the approvals?

I understand they have a bit more time to comply with the regulatory requirements, but what is actually causing this continuous deferment of the approval timeline? That's my first question.

Arun, sure, sure. Yeah.

Arun, basically, already we had said by Jan-Feb, we will be ready with all the modifications which they need, post which they will do the online or visit. Basically, that is today the status.

We are today in the middle of Feb, and we are right now completing. We have basically intimated that, yes, we have carried out all the changes.

We keep discussing with them every alternate week. They said, "Okay, we will let you know what is going to be our action plan going forward."

Whether they will come within one, two weeks, whether they will come in three weeks, I don't know. We were supposed to be ready by Jan and Feb, which is what we are ready.

Now they can come anytime. What I told by June is not only the existing customer, but even the other customers also who are now approved, even they are likely to complete.

Some of them started late, right? Even these guys now are saying, "Okay, I will come for an audit in April or March or something."

By June is what we are expecting is even the new customers also should complete.

For these new customers also, this is a final leg of the audit, or it is just a beginning first final? Yes, yes.

No, no, finally. Finally.

Of course, they can come and say, "Hey, I want a plant which is similar to your Pakhajan plant." That's a call which they will take once they finally come and do.

I can't predict that, right? That would be the audit.

If they come, they are satisfied, then we can start. Then maybe some of them say, "Oh, Pakhajan is going to be a much better, much bigger plant because it's designed from scratch.

Maybe we'll just wait six months and take it from Pakhajan." That can happen.

Many of them right now are showing urgency to buy now, we hope that they will start buying from Dahej and then move over to Pakhajan afterwards. After three or four, maybe one or two will go this way, the other may say, "Okay, I'll wait for Pakhajan and then start."

Because, anyway, the capacity that we have in Dahej also is relatively limited.

Right, right. Dr.

Harin, we also saw a few of

Sure, sure, we'll do that.

Yeah. Dr.

Harin, we also heard that a few of your US customers are going through some restructuring, where the OEMs earlier had entered into the JV and later on, they are backing out. Does it concern you that at this stage, these kind of a restructuring is happening which can potentially again delays approvals or something like that?

I think maybe you are talking of GM and Ford doing some JV changes, etc. We are not affected by any of those, yeah.

Does it mean that going forward, you will have two layers of approval, one from my god. Sorry, sir.

Hello?

Can you go ahead? Sorry.

Does it also reduce your potential clients from say, earlier you might have a mix of clients between OEMs and battery manufacturers, and now potentially OEMs backing away from directly being a stakeholder in the manufacturing. We will be having a reduced pool of such customers.

Is it the right way to look at it?

No, Arun, basically, you have to think that majority of the OEMs or these JVs are basically OEM is cell producers. Basically, what happens is when you're thinking of electrolyte intermediate, which is LiPF6, the two main vendors are cell producer and the electrolyte maker.

These are the two people who have to approve you, okay? Of course, in some cases, the cell producer also will be an OEM.

As I explained that, as compared to before when we had, okay, maybe one company, right, who had contracted with Neogen, with the Morita JV that we have done, there are several more who are interested. Actually, our market in a way with the JV has expanded and more customers are available to us as compared to earlier.

Understood. Understood, sir.

Second, you spoke about various fundraisers which is going to be happen across in the next six months, roughly 6 to ₹500 to ₹600 crores. This will be largely utilized for the working capital requirements as we scale up the business, because most of your capexes anyway you have already tied up.

Is it the case, or we'll be again going for the separate working capital loan? How should we look at this?

Whatever money we are raising, right? Some of it would, of course, be like, for example, the JV money which is going to come, that will be partly used for completing the capital projects, right?

Because there also there's some contribution still needed. As you see, our total debt, as I explained earlier, we've not utilized all the term loans fully, there's some contribution required from us.

Partly it will be for that contribution, partly will be for, of course, working capital reduction. It's all not fund raise, that's the money which is going to come in, whether it is from insurance, the second is from the JV, and the third is from what we currently propose promoter infusion.

Our first interest payment, that is moratorium that still we are two quarters away, right? For the principal repayment.

Yes, yes. For whatever loans we have in Dahej, let's say, if we are completing in Q1, then the first principal repayment will be Q1 of FY28.

In case of Pakhajan, right, it will be like we have right now said H1. For example, if we are saying H1 FY27 is H1 FY27 when we start, then H1 '28 would be the equivalent first repayment after that.

Basically, one year from the start of the plant. From the SCOD.

All right, sir. Thank you very much, all the best.

Thank you.

Thanks for the opportunity. First question is in terms of our guidance for FY27 and beyond.

We had indicated that we will be having about ₹400 to ₹500 crores from the battery chemical part of the business. However, there has been slight delay in terms of commissioning of the project, in terms of approvals.

Do we stand with the same guidance, or we would like to revise it for FY27 and maybe that will fall back even on FY28? Thank you.

No, our guidance remains the same because, the guidance the expectation was that our Dahej site will be fully ready by June, and our expectation that, we will start having sales of this from basically Q1 and majorly from Q2 onwards. That remains same, therefore, like, our guidance doesn't change.

We have right now not considered the Q4 sales from Pakhajan, so that we have basically kept as a backup. Like in case if, there's some further delay or so that that would be like a additional sales which will happen.

Just our Dahej sales and whatever expected electrolyte demand should be able to allow us to reach the original target. Whatever we do Q4, either in case if there is any slip-up from Dahej, that will be the Q4 salt sales will be contributory of that, or that will be then an additional one which will be over and above what we have planned.

That's helpful. On the Neogen Ionics, the Morita JV, how this entire deal has been structured?

Effectively, valuing the JV at $100 million. What is the current infusion by Neogen in terms of equity as well as debt?

There will be another $20 million which will come from Morita. Given that we have ₹1,500 crores of total investment plan for this, how the equity participation and the debt will look like when the entire investment has been made?

One thing which is very clear is 80% is going to be 80% is going to be Neogen's portion, 20% is going to be Morita's portion. We are still discussing with the banks on exactly the debt-equity ratio which we have once we do the separation.

We are hoping they will maintain at the same 75:25 level. Depending on that, whatever is the balance which is not contributed by the bank will be in the form of the equity.

Some of this has already been contributed in the form of equity. I think it's better that I'll be able to give a better clarity on this once we have the final clarification from the banks once the loans are separated and we are able to take it separately.

Right, right. Just one clarification.

Effectively, next year when Dahej starts generating revenues, there will be a 20% minority interest for this equity stake of Morita. Is that right understanding?

No, not in Dahej. No, The Dahej is 100% Neogen.

Only the Pakhajan site is going to be through Morita.

Okay. Can you just split up in terms of Pakhajan site, what could be the potential revenues in FY27 and maybe on a longer term in FY29?

Again, in Pakhajan, the salt business will be if the question is from that point of view. The Pakhajan site is going to be only the salt part will be Morita, and Dahej and the electrolyte will continue to remain with NCL.

In FY27, as I explained earlier, that currently we have not considered significant sales, because it'll be in Q4. We have kept it as a bonus.

Majority of what guidance we have given will be largely NCL sales. Maybe some of that would be routed through NNML, because ultimately, for example, the salt in the international business is only sold by the JV.

From a revenue point of view, I think majority of this would be NCL for FY27. If you talk of FY29, see, FY29 is a bit tricky, because it depends on how much of the salt we are consuming internally and how much of the salt we are selling in the international market.

Now that depends on how the international market develops beyond the initial years and the desire to have a China-free supply chain, etc. The second is how the Indian customers choose whether they want local supply of LiPF6, or they want lower cost, or so it depends on that.

Actually, if you see, if we have to take care of our existing international customer demand as well as Neogen's own internal consumption, then basically we would need more capacity for the salt, because the current capacity of the salt is not going to be enough. We'll have to add capacity.

I think and that's a decision we'll take somewhere towards end of FY27 or FY28 to take care of the FY29 demand. Because India electrolyte demand is still developing in FY27 and '28, the capacity will be sufficient to take care of both.

By FY29, if we have to take care of both, international as well as local consumption, then we need to add more capacity. I think it's a little bit difficult for me to tell you in FY29 how the break-up will be.

Sure, sir. This is helpful.

Thanks a lot for answering all the questions, and all the best, sir. Thank you.

Thank you, Rohit.

Good afternoon, team. Thank you so much for the opportunity.

Sir, one question on the US side. If Chinese-origin salts get restricted from, let's say, 2027, is it possible that US customers think about pre-buying and storing inventory in 2026, and then start using it in 2027?

Meet, there are two things, right? See, the batteries which are made in '27 cannot be using Chinese.

It's not about buying, it's about making batteries which are not containing the material. It doesn't help them to store and use that.

It's not like a custom duty which is going to come up, right?

Got it.

It's on the usage. Therefore, that is not happen.

The second thing is the way things stand today right now, with the Chinese prices, sometimes China is even more expensive. Third point is even if you wanted to store and use, usually the shelf life is not more than six months even as a electrolyte salt stage.

I don't think they can store too much of it.

Got it, got it. Sir, also, when customer talk about reducing China dependence, how does it actually play out in practice?

Let's say, do they typically start a phase dual sourcing ramp-up, or ahead of the time, let's say, they start from Q3 Q2, Q3 FY27 onwards, or when we can see the major ramp-up from US customers? Broad idea.

There are two types of customers, right? There are some customers who are cautious, who started working with us two years before and preparing for it.

There are a few customers who are basically saying that, yes, they would like to have a ramp-up, they will have Q2 some quantity coming from Neogen, then Q3, then Q4, and then maybe next year further quantity. There are some customers like that.

There are some which are very price sensitive, of course now last two months the things change, but till that time they're like, till Q4 we will audit you, we will validate you, everything we will keep ready, and Q4 is when we make the switch, right? Because that is what is regulatory driven.

There was one customer who was more regulatory driven. There were some customers who wanted to be cautious, wanted to gradually scale up.

Other customer says approval is very complicated, first do Dahej, then again do Pakhajan, I will start only directly from Pakhajan. It's kind of like a mix of those.

Some of these also keep changing, because they had some different response when the Chinese prices were very low three months ago. Now they have another response where they said, "Okay, before I said I will buy only from Pakhajan, but now, okay, maybe I can consider Dahej also, let me start approving Dahej."

All this is changing customer to customer and, again, depending on the market situation.

Got it, got it, sir. Very helpful.

The last one, based on let's say ongoing negotiation with customers and the ecosystem players in India, any rough indication actual what can be the actual cell capacity is operational by let's say end of 2026, and how that number look up to you in 2027?

You mean calendar year '26 and '27?

Right.

Sorry, what was the question again? I said you said something in India, the voice was not very clear.

Yeah. I asked, based on maybe negotiation with customers and the ecosystem player in India for the battery cell manufacturing, any rough indication how much actual cell capacity can come online by let's say end of calendar year 2026, and how does that number look in 2027?

You are saying cell manufacturing capacity, right?

Right, right, right, right. Battery cell, right.

Okay. Battery cell, if you see right now what we have to go by whatever is public information available, Ola has announced to go from 1.5 to 5 gig.

Then you have a 3 gig which is starting of Exide, and 4 gig which is starting from 4 gig which is starting from Waaree Energy. This if you look at that, between them, technically, you should be having around 12 gigawatt hour of production, which will be coming online in the current year, right?

By end of this year, you should have a 12 gig let's say if we say 12 gig, and if the ramp-up happens okay, every month, for example, 1 gig kind of a consumption should be reached by, let's say, end of December '26, right? The actual consumption may be somewhere between actual production may be like 3 gig or 5 gig or 6 gig, depending on how it ramps up.

When you enter 2027, you enter with a 12 gig of already installed capacity. To this, you may have to add then whatever Reliance has announced and Amara Raja has announced and Tata has announced.

If you think of their original starting capacities also, what they wanted to do, Reliance's intention was to reach up to 40 gig in one year from start. If you look at Amara Raja, I think the starting capacity was, I think, around 2.5 or 5 gig, and Tata has not announced the starting capacity.

If you add all of that, you should be, let's say, at least about 25, 30 gig by end of 2027 as we enter 2028.

Got it, sir.

Of course, by that time, you also need to add that by that time if Ola further increases the capacity, or Waaree's intention to increase capacity from 4 to 20, or Amara or Exide's plant to increase from 3 gig and beyond. I think by end of '27, we should be if everything goes well, by end of '27, we should be 40, 50 gig plus entering into 2028.

Based on whatever customers have shared with us.

Got it. Sir, one question on let's say I was talking with many players, everyone is in a view that everyone will prefer to have two suppliers, right?

One primary and another maybe secondary also. Let's say if in India, Waaree wants to have a two supplier, what is the let's say moat or maybe the USP of Neogen that it can be a primary supplier as compared to our competitor?

Just want to understand what are the qualitative terms that Neogen pitch to Waaree or maybe other guys also that they prefer to have Neogen as a primary supplier.

I think one is, we are already ready, we already have three, four years experience to make it in the lab and supply successfully, and last one or two years even from a commercial plant in Dahej. Second is

we have Mitsubishi collaboration, Mitsubishi is known to be the best electrolyte producer in terms of quality. Then you can be 100% sure about the quality of the supply.

The third is, we have the backward integration. The fourth is we have actually capacity, because one of the thing is, you need to have the capacity.

Right now we'll have a 30 gigawatt hour worth of capacity, which will be ready, let's say, so that nobody has to worry about, oh, whether Neogen can supply enough quantity or not. I think these three, four things make Neogen in a positive note.

Just for your reference, not everybody in electrolyte has always two suppliers.

I know historically many companies where one single supplier, if they feel the risk, they will ask the same supplier to keep multiple plants. Sometimes they can have one single supplier exclusively.

Two suppliers is not always the necessity in case of electrolyte.

Hi. Good afternoon, Harin.

Harin, my question is on our CDMO and advance intermediate business. How much was the contribution from these two business verticals in nine month FY26, and how is the progress in the inquiries in CDMO and advance intermediate business?

Any guidance on that for FY27?

Nilesh, thank you so much for asking me also some question other than battery. Appreciate that.

No, I think CDMO and advance intermediate, we are slightly better as compared to last year. Actually, for the first 6-month, 9-month, we were actually ahead as compared to last year, but whatever POs which we had with our customers we completed.

Now some of the new revised repeat POs people are waiting, specially on the CDMO side, for the new site to come online. We've shared our progress with the customers, and maybe by end of this month or from March onwards, customers will start visiting.

We expect again some repeat orders or new projects which were kind of on hold, we can start achieving orders against that. Overall, I think we will expect that as we go, let's say, this year if you look at the run rate, we are at around 800-plus kind of a revenue.

As we go from 800-plus to 950 or so, we feel CDMO will be one of the significant areas CDMO and advance intermediate will be a significant area where we'll have growth. If I were to just look at nine months numbers, It has been same as compared to the previous nine months as against advance intermediate and CDMO level.

Despite our Dahej facility is not there, right?

Despite. There was one semiconductor customer that required a specialized equipment, they had enough inventory, we had to skip.

We couldn't do this year. Despite Dahej not being there, we were able to maintain the same level.

Most of these products we were able to do from Mahape and Karakhadi. Some we couldn't do, we couldn't register a growth there, but we were able to maintain.

Just secondly on this toll manufacturing arrangement that we made because of non-availability of a Dahej facility. What percentage of revenue is currently coming from that, and when we are ready with our Dahej facility, do you expect some margin expansion because you are shifting from tolling model to in-house production?

Currently, some of the higher costs that you are seeing will reduce, right? Your other expenses will change a bit, where whatever is the tolling related expenses there will kind of go away.

Of course, some of it will come in the form of additional power and fuel kind of expense at our Dahej plant. Net of what we feel is you should have improvement in our cost structure.

Just how much business currently we are doing through our tolling model that we can shift to our in-house production?

Basically, Nilesh, it's very difficult for me to say because in some cases, I'm just doing one stage there. It's not that okay, completely it has been done, right?

Basically, we are using it on a need basis, right? You can basically say that we are able to maintain our current revenues because of several sites.

We are not using this one site, there are several sites which we are using in different ways. Most of it whatever we want to use it will be done by March, and April onwards, our Dahej plant will start getting available partially.

Maybe by end of June, we feel it will be fully available. With the inventories that we built up and the first quarter once the production start, I think we should be okay.

Then let's say Q2 onwards, you'll have a stable production. One, as we try to get let's say ₹950 crore, our quarterly run rate also improves to ₹225 to ₹250 crore kind of range in the next financial year, as well as some of the tolling-related expenses will go down.

Also, our insurance premium also the first year is the toughest, so that is from July to July. Once that July gets over, from next year maybe Q2 or Q3 onwards, you have Dahej which is fully stabilized, you have at least the worst of the insurance is over, right, and the tolling arrangement cost is also gone.

Hopefully by that time, Dahej also will be contributing from Q2, Q3 onwards significantly on the battery material side, so that's when you'll have good improvement in our performance.

Okay. Thanks, Harin.

Thanks a lot, and all the best.

Thank you, Nilesh.

Yeah. Hi, sir.

Am I audible? Hello?

Yes.

Yeah. Just I had one question on the inorganic segment.

If I just exclude the Neogen Ionics revenue, the trend has been on the downward side for the inorganic chemical segment. If you can just present your views what is the cause for this?

Is this solely attributed to the downward lithium prices, but now that also has spiked up. Just wanted to get your view.

It's solely attributed to the downward lithium side, and the spike impact will see maybe little bit in Q4, but more in the next year if the spike is maintained. Because the lithium prices started increasing almost towards December, and in January you saw majority of the increase to happen.

The material from there will hit me by March or April, right? Before that you will not see a big spike.

Sure. Sir, still revenue has come on the lower side solely attributed to the price, right?

Yes. Yes,

yes. Sure.

Thank you. That's it.

Okay.

Sir. Thanks for taking my question.

Sir, now probably it's a given that Pakhajan will ramp up only in H2 FY27, as you have mentioned. Now just accounting for that, sir, would we be able to clock in ₹400-₹500 crores from battery chemicals in '27 accounting for that, and any approximate revenue estimations for '28 as well?

See, basically, we have considered very limited from the salt sales of Pakhajan, right? Because we said it's in H2.

Electrolyte will be stable in H1, and as I answered earlier that increase in capacity of Ola, Exide getting stable, then we said even Waaree starting. Maybe we can expect some electrolyte revenues coming in the second half from these people ramp in their operations up.

That is what something which we have considered. As I explained that we said, okay, the salt in Pakhajan will come in H2.

Technically, we have not considered any sales, although we are on track that at least in Q4 we can get some sales, but I have right now kept it as a backup that because this year, from the time we got listed, first time whatever revenue projections we had given, we had to make a significant correction. I'm a little bit more careful.

What we have done is that Q4 whatever Pakhajan salt sales we've not considered. In case if Dahej is slightly delayed or electrolyte is not delayed, the Q4 salt sales will allow me to basically make up for that, so that we don't go wrong on our guidance in the next financial year.

That's kind of on that. I think FY28 it's too early for me to give a number, but one thing which looks very strong to me is that our salt capacity should be utilized at 80% or more, because that is something which will be in a very strong demand.

Of course, if I sell it in the form of electrolyte, it will be higher. If I look at today's market price and if you think of 5,500 tons of total salt capacity, and if you think of a 80% utilization even on that, right?

That's around 4,400 at $20 plus kind of a dollar price, right? Salt and additive is even higher.

On an average price about $20, if this assumption is valid, then you have a ₹1,000 crore plus kind of revenue. Of course, whatever I sell in the form of electrolyte, there's further value addition.

Therefore, it should ideally be beyond ₹1,000 crores. It should be substantial.

How much beyond is a little bit difficult for me to tell you now.

Sure. At least the initial estimate, you said ₹400-₹500 crores, we are sticking to that for '27 for battery chemicals?

Yeah. There's no change in that.

Yeah. Because you said you're right, because electrolyte at least will be stable, and at least we'll be able to garner some volumes from the electrolyte sales.

Yeah.

See,

electrolyte sales unfortunately, I am dependent upon how my customers start their plant. That's not something which I can do beyond.

That's why I have kept the Pakhajan Q4 as a backup, where anything we do overperformance there can be a backup in case India electrolyte demand doesn't shape up as much, or in the beginning approvals in Dahej are delayed. We can kind of make up for that.

Sure, sir. Sir, just if you could tell me, 30,000 is what you're clocking in at Pakhajan.

I'm only talking in terms of electrolytes. By H1, how much will be online, sir, from the 30,000 MT?

By end of H1, because we are doing a joint trial with Mitsubishi. Our idea is that the entire 20,000 There are three plants, and all the three plant lines will be tested, and we would be ready for the 30,000 ton kind of annual capacity, which is monthly around 2,500 ton.

Of course, we will take care of the operational side that we don't see in the first year business visibility. In terms of manning our people or some other expenses, we will kind of do it gradually.

The plant will be ready for the entire 30,000 ton.

Okay. Sure, sir.

Sir, just in terms of revenue growth from the base business, which gets talked about less right now nowadays. Just to understand in '27 and '28, '26 was subdued.

I understand the fire thing and everything is there. With '27, can we expect double-digit revenue growth especially with the Dahej plant coming on track post the fire?

Just wanted to know for organic, inorganic, how do you expect the base business? Can we expect a double-digit revenue growth there?

Yes.

Okay. Sure.

Just lastly, sir, just wanted to understand in terms of this QIP, this ₹150 crores as you mentioned, just a little bit unclear on this. The ₹150 crores is basically, is it the promoter group is going to increase the stake, or is it just a regular QIP which is done?

Just wanted some clarity on that.

No, this is a pref allotment. Basically, we felt that Neogen could help with the equity.

We know the insurance money is also coming, the equity is also coming, but as I said, there's a good salt demand also. We felt that in case suppose if we have to do a little bit more on the salt or additive, or as well as in the interim, if we had that equity, then that would really help Neogen to seamlessly continue and make sure that all our execution in 2026 happens seamlessly.

That was the whole idea. We as a promoter group decided to invest ₹150 crores.

As I said, there's this one clarification we need to take because my father and mother had formed a trust, which was a family trust, and SEBI already gives a permission that this is it's like a promoter and promoter group. Just because of that, there has to be some cooling-off period.

Whether that is needed or not. We are just taking some regulatory guidance on that.

Otherwise, the idea was to bring in ₹150 crore in the company before March, so that will also reduce the interest burden and also give us a lot of flexibility on things that we want to do.

That comes in from the promoter group. Is that right?

Our stake which is right now at 51.22%, that increases basically in the company.

That's right.

That's great, sir. Just one last thing, this insurance claim money, I understand you said Morita is fine, that'll take some time, ₹150 crores from the promoter at least in Q1 FY27.

To this insurance claim, sir, this ₹200 crores for the stock claim, till by when can we get this?

See, ₹60 crore is expected maybe today, tomorrow, within this week, because the insurance company had already taken all the documents from us for release of the ₹60 crore. We had the agreement.

This is the second interim against rebuilding the plant, right? We have two: stock and rebuilding the plant.

Against rebuilding the plant, they are ready to issue ₹60 crore at any given point of time. There are five insurance companies, they all have to pool into the lead insurer, and the lead insurer transfers the money to us.

That process is ongoing, but that should happen anytime. Then, the stock claim was also in case of the stock claim, the insurance company had appointed like a third-party Big Four kind of auditor, right?

Their process is almost complete. They should finalize the report, based on that surveyor should finalize the report, and based on that, the money should ideally be released before March.

Maybe it can slip up, so that's why I said March or April. We are working very strongly now with the insurance that, look, we have built the whole plant.

In fact, if everything happens, we can even ask for the third interim against, because this should still be ₹140 crore, we can still ask for one more interim release before March. At least these are the two which I am currently taking.

Then, of course, in the next year, as I explained earlier, that the rebuilding cost is going to be more than the loss, right? The balance material which is left against the rebuilding plant as well as the higher rebuilding cost, so that has to be assessed and that has to be released, and the loss on profit has to be assessed.

That is something in my view, the first part, the balance on the capital rebuild should happen before September, and maybe the loss on profit should happen somewhere between September to December. In a way, everything from the insurance ultimately hopefully should be achieved by September to December next year.

Okay. Thanks for answering my questions, sir.

Thank you.

Yeah.

Just a small thing. What would be the ceiling on capacity utilization in terms of salts and electrolytes once we fully ramp up?

You mean utilization-wise? Normally salt would be at 80%.

It's like a chemical plant. In case of electrolyte, it is a formulation plant, you can go up to 100%.

Okay. Sure, sir.

Thank you.

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