Hi. Good morning, good afternoon, everyone.

A warm welcome to everyone to the third quarter 2025 earnings call. We thank everyone for their participation.

Today the way that we'll be having this earnings call is we will be starting with introduction. We have our CEO, Mr.

Vivek Dhawan, joining this call.

Good afternoon. I'm Vivek here.

Welcome to the call.

We have our CFO, Mr. Thomas Abraham, joining this call.

We have Mr. Francis Rego, Senior Vice President.

Hello. Good afternoon.

Our Corporate Secretary, Ms. Sujintana, joining this call.

And— Sawatdee kha. —and

myself, Manoj Gurbuxani. What we'll do today is we will start with the with the synopsis of financial statements for nine months 2025 and third quarter 2025.

I'll give you a brief of how we have performed these two periods. Thereafter, we will have remarks from our CEO on the financial performance and the outlook for the year and a few business updates.

Thereafter, we will move the forum to the Q&A. We would request when you're raising your question and answer questions, please let know your name and the company company you represent.

Going by the agenda, first, explaining the financial performance. First nine months 2025 performance.

With the Myanmar distribution and branded business showing an improved sales momentum in the third quarter, the overall revenue for nine months 2025 is at 10.4 billion. With the stabilization of business, the overall decline, which we experienced in first half at 14%, has narrowed down to 10.3% in nine months 2025.

Going by segments, the branded business for nine months 2025 was at 6.3 billion baht, reflecting a growth of 4.3% on a YoY basis. If you normalize the decline of Mega We Care business because of business in Myanmar and the currency impact due to appreciation of Thai baht to US dollar on a YoY basis, actually the Mega We Care business in volume is growing at low double digits in other markets, which is a positive sign.

The distribution business revenue on a nine months basis has declined by 27%. With the improved sales momentum in Myanmar in third quarter and stabilization of Maxxcare business revenue, the decline in distribution business has narrowed down from 34% in first half to 27% in nine months 2025 because in nine months in third quarter, the distribution decline is very, very marginal.

Coming to the overall overall gross profits, the nine months 2025 our overall gross profits have been at 51.8% of the operating revenue compared to 49.6% in nine months 2024. The improvement in gross margin is mainly because of the segmental mix, because branded business grows has a better gross margin than distribution business.

Segmental mix has resulted in better better overall operating gross profits, which is at 51.8% on nine months 2025. The branded business gross margin has remained stable and is within the norm.

We generally guide a gross margin of 63% to 65%. Nine months 2025, our gross our gross profits were 64.4%.

The distribution business gross margins improved to 26.2% on an adjusted basis, adjusted for the dual currency rate effect in Myanmar, as compared to 23.6% in nine months 2024. The SG&A expenses have been at 3.3 billion, flat on a YoY basis.

If you look at us, we are very controlled spending on SG&A all the three quarters. All the three quarters have experienced flattish SG&A spending.

However, as a percentage to revenue, the SG&A expenses has been higher as compared to last year, which is primarily because of the decline in the operating revenue because of Maxxcare business in Myanmar. The reported net profits have been at 1,335 million, which is very close to nine months 2024, which was at 1,373 million.

With the with the with the improved sales momentum, which we've experienced in quarter three in Myanmar both in distribution and branded business, the reported net profits have remained similar as compared to last year. If you look at the decline, which was at 15.1% in first half on a YoY basis, that decline has come down marginally to 2.8% as on nine months 2025.

The adjusted net profits for nine months 2025 have been at 1,435 million as against 1,595 million last year, a decline of 10.1% on a YoY basis. The decline in the adjusted net profits is mainly coming because of decline in Maxxcare business in Myanmar and increase in tax tax expense, which is primarily because last year we had a tax privilege from Board of Investments, which is no longer there in year 2025.

We continue to remain a strong balance sheet company with a net cash of 3.4 billion. Our operating cash flows have been at 1.7 1.7 billion, representing 128% of profits.

On nine months 2025, we have spent 430 million baht towards CapEx, which is majorly towards acquisition of land in Vietnam for constructing the manufacturing facility as we had guided earlier. The some portion we have spent towards maintenance CapEx and capacity expansion for manufacturing operations in Indonesia, Thailand, and Australia as guided.

Overall, in terms of CapEx plan, apart from the normal spending maintenance CapEx of $3 million to $4 million, which we do, we intend to spend 483 million baht, which is mainly towards expansion of Indonesian manufacturing facility by adding new dosage forms and plant upgradation. Looking at the third quarter 2025 performance, with again with the improved sales momentum in the third quarter, our overall operating revenue has been at 3.

3.8 billion, which is growing 14% on a QoQ basis. The branded business revenue in third quarter was 2.2 billion, reflecting a growth of 7.7%.

Again, normalizing the impact of currency impact due to appreciation of Thai baht to US dollar, the Mega We Care business is in fact growing at low double digits in all the markets. The distribution business revenue in the third quarter stabilized with a very small decline of 7.3%.

The decline again is coming because of the Maxxcare business in Myanmar, but the decline, which was at 34% in first half, has come down only to 7.3% in third quarter 2025. The overall gross profits also have remained stable at 52.3% as against 53.4% in third quarter of last year.

The branded business gross margins again within the norm, which we have which we always have within 63% to 65%. Branded business had a gross profit of 65.6% in third quarter 2025.

The distribution business gross profits were at 23.1% on an adjusted basis, improved compared to 20.5% on an adjusted basis for third quarter of last year. SG&A expenses continue to remain flat on a YoY basis at 1.1 billion, representing 28.5% of the operating revenue in third quarter 2025 as compared to 27.5% last year.

The reported net profits have been at 494 million as against 383 million last year. With the improved sales momentum in third quarter in Myanmar in distribution and branded business, the reported net profits have improved by 26.4% on a QoQ basis and 29.1% on a YoY basis, which is primarily coming because of stabilization of distribution business, growth in branded business, and lower forex losses.

The adjusted net profits are at 514 million, very similar to last year third quarter 2024. Overall, our adjusted net profits grew at 18.3% on a QoQ basis.

This is, in very brief, the synopsis of of third quarter and the nine months performance. Now, I request our CEO to provide his guidance for the year as well as [speak on?]

the financial performance. Thank you.

Thank you, Manoj. I think you've got all the background on how the performance has been in the last quarter and the last nine months.

The good signs are branded business is growing, and that's where our focus is. As adjusted, as Manoj has confirmed, the adjusted growth is in what we call low double digits or higher than single digits.

We are moving in the 10% to 12% range growth rates, which is a good sign. Other than the baht, which is impacted compared to last year, and that's one reason the BOI privilege is going away, and that's impacting our bottom line.

If we take those two away and we compare, our plan in 2019 and today, somewhere around was 2.1, 2.080 should have been our double profits, if we compare the profits then on an adjusted basis. We should probably reach 95 93% to 95% of that by the end of this year.

We're fairly close in spite of all the problems in countries and war and the Myanmar situation, which in '19 was not the case. It was a very large part of our growth plan.

In spite of all this, I think we are holding up very well and growing our branded business. That's one part.

Going forward, I think that the next quarter generally is a better quarter in terms of sales and bottom line, we expect to get to that with the present numbers are that what, 1,435. We should get to a number which is close to 1,950, somewhere in that range.

That's the guidance. Going forward, years after that, we're working on a strategic plan and our focus on building our branded business on both consumer health and pharma, healthcare, both divisions.

The consumer health, we have vitamins, supplements, herbal medicine, which are complementary medicines, largely focused as medicines. They are not foods.

We don't do a lot of food and cosmetic products unless there are a few areas we do operate in, but largely medicines. We are focusing on that and building some of the brands we already have, large categories that we are involved in from GOFENG, Gogas, gut health, NORMAGUT, NUCLEAT.

Cold, cough, pain, allergy, all these areas where we are investing money. We hope to focus more, go deeper into certain therapeutic categories and build global, especially in our 33 markets, larger brands of what we already have.

The pipeline that we are developing are all adjacent, either going different dosage forms in the same area or going to children, adult areas, so that we can concentrate and bring a lot more focus in building our branded business. Consumer side, OTC drugs, and the pure pharmaceutical area also we have a few focus areas that we operate largely in, that's orthopedics osteoporosis, as we call it, ortho, urology, we are spending time and money in building a pipeline there.

There's derma. We are very serious players in the derma category with a few unique drugs and more pipeline coming in.

We are also in diabetes, where we operate in a few markets where we play a major role and we have a huge pipeline in that area. There are certain other categories where Mega has ventured into respiratory, which is a new area that we are working on.

I think those certain categories where we see a large opportunity for us to build a sizable business, specializing in some of them, and we're going to spend a lot more time including our pipeline is also directed towards developing new products in that area, our own in-house and licensing in. With that kind of a direction, I think over the years, you'll see probably the pharma business becoming nearly 50%, OTC business anywhere between 10% to 20% in that range, and consumer, the real vitamin, supplement, mineral, which are dedicated to certain categories like NAT B, NAT C, NAT D, and LIVOLIN, another product which are large areas for us, NORMAGUT, etc., in those areas, that also taking up a 30%, 40% range.

We are a very balanced consumer health and pure pharma play and operating in 33 different countries. The growth will come from the markets we are already in.

We don't see a lot of expansion in new markets coming up. Where we are there, we're going to dig deeper, put our boots and heel and dig in and do more.

Hopefully with that focus, we will be able to grow and develop our business to double the market size we have now in the next five years to come. That's the plan.

We are working on more strategic clarity on this and working on a strategic plan. Over the last eight months, we've been doing that.

Hopefully by February, March, when we meet you again, we'll come back with more clearer focus and clear answers for you. That work is going on.

As Manoj mentioned, we've already started our manufacturing site. Because of various reasons, we have mentioned to you to play in Indonesia, we have a site.

The site is developed now. The final internal work is going on.

Hopefully by June next year, we should be installing machines and be ready to increase capacity and bump up all the new products that we are doing. Meanwhile, product development, registration work for imports and local manufacturing is going on there, and we are moving towards our plan that we have projected approximately $50 million by the year 2030.

That's still in force, and we are working towards it with the pipeline we have. Vietnam, we already have a business, but with the local laws and changing regulations and all the requirements, and the tender businesses we play in and many products that are locally sold in Vietnam, the requirements of making, storing, and delivering, and doing marketing for the products made locally is growing.

We are investing in a facility in Vietnam to make medicines. To begin with, large part of our business is tablet, hard gel for the drug part.

We also plan to put a soft gel line and some other dosage form that we are not in other countries. We have just inaugurated or just pressed the button today, the construction to start, cleaning up the site and appointed contractors and designers.

Work is beginning. Hopefully in 15 months, the plant will be ready.

It'll take with all the operations, moves are another probably 15 months. So 30 to 36 months from now, we hope to see the Vietnam manufacturing site up and ready and also producing in 36 months.

That's the plan. Myanmar, we are still in the final stages.

The land we have, that's already done. We've applied for licenses, and hopefully that'll also begin.

We hope to sign up and tie up all the design work is done, by next year March, I hope we can also start the building of the site in Myanmar, largely as we understand imports are difficult, and we are going to be playing in that market, which is a large market for Mega. The brand, Mega brand, is there for the last 30 years, so that's the plan.

Hopefully doing all that investment that we're making for long term, next 5, 10 years, 15 years from now, we believe with this we should be able to reach our goals and deliver double profits in the next or at least 80% higher profits in the next five years. There's something that we're working on.

We're very confident that we should be able to do that. From my side, I think this is most of it that I have to tell you.

If there are questions, we'll be happy to answer them. Beyond that, I think we are ready to take questions.

Now, like Manoj said, please tell us who you are and where you are from, whichever organization you represent, and tell us what you want to know, and we'll try and answer them as well as we can. Whatever we miss, we're always available to reply to your queries on a one-on-one basis here.

Thank you so much. That's all from my side.

Let's hear from you and reply.

Somebody [PJ?] has raised his hands.

May we request to ask your question, please?

Hello, hi. This is Thanapol from [TGSI?]

. I have a question on Myanmar.

In the third quarter, you have become a lot more successful in delivering sales into the country. Are there any recent changes or on the ground developments that we should take note of?

In your view, how sustainable is this recovery?

I think licensing is one area that mattered to get products in the country. If you have products in the country, our brands are strong.

Licenses improve a little bit, and you get periods when you get more products in. The consumer business also is getting some licenses.

There's an improvement in getting licenses, and we hope this will continue for the next period to come. It will not be 100% like it used to be before, but there's definitely got an improvement, and that's also showing some improvements that you see in the branded business that you see.

Overall distribution is still not to the level that you want. It's just improved.

It's not getting worse, it's now stabilized. We're saying it's there.

Since we have a few principals that we are working with, a larger partner, and making sure that we can bring in those products and make sure they are strong, that's where our focus is. With both these things, limited numbers and focusing on certain areas and doing the big one, we are finding some stability there, but it's not to the same level.

At the same time, our own branded business, where we are doing that's also having when we have stocks, and it seems it's better now. It'll be better than before.

Overall, economically also, there's a bit of settlement. There's not as much fighting going on along the roads.

It's a little bit more eased out. People have probably gotten used to it, and business is a little bit better, I would say a little bit better.

It's still a long way away from where we were and where we were supposed to go in the old days. That's the reason from our point of view.

Will it be sustainable? We think it's going to be better.

There's an election coming up, and hopefully there'll be some easing, but within limits because that's the situation in Myanmar at the moment, so.

Right. If you look into the fourth quarter, can we somewhat expect top line to Myanmar to stay somewhere around the third quarter level?

I think so, looking at our stock position that we have in the country, We are not basing on what I can get next quarter, because to sell this quarter, we already should have stocks in there. Looking at that, we believe that we should be able to achieve the numbers that I mentioned, that we should be able to deliver that above single digit.

Single digit or high single or high single digit or at the end low double-digit kind of delivery numbers on the branded side. We still believe, looking at the detail we have, it should be possible.

That includes Myanmar as well. Some are a little bit higher than Myanmar, as Manoj mentioned, But they are small, they're doing maybe 14%, 15%, but the averages cannot go up, Burma has a role in it.

It will probably linger around there, and it's going to grow. Overall, we expect from all countries put together to be somewhere there.

Right. What about the distribution side?

Distribution will probably remain the way it is, it's not going to get worse, and it's going to be something that as we have seen in the quarter three, right, very similar kind of numbers that you would see. Like other businesses, probably if we start maybe a slight jump up, but you will not see huge changes that is not in distribution.

Last year fourth quarter was already very low

because Compare quarter to quarter to

quarter, yeah.

On an annualized basis It probably look better, stabilized.

Stabilized. Correct, correct.

Got it. Got it.

I think my final question is on Cambodia. I think at the moment there's no problem bringing goods into the country, but there have been some reports about inventory being built up in the country because of the boycott of products from Thailand.

Does that affect your distribution business in Cambodia?

Yes, Cambodia is difficult. I won't deny it.

There is a lot of things going on, and I don't want to get into the politics of it at the moment because that's the problem. Locally, there is information being sent to them, a lot of Facebook ads and even there are, I'd say, some pressure on groups to stop buying and stop using Thai products.

There is a problem. The good thing is a lot of our products are not only sourced from Thailand.

We represent brands in distribution from L'Oréal to other companies who are not manufacturing everything, and they have started to source from other sites. A lot of this also comes via sea.

It doesn't go out of border, all of them. There is some impact because a lot of them could goes to the border before.

They've been able to divert that. A lot of our products are also made in different countries, Europe here and there, Australia.

There are some that go from Thailand, and there is definitely a feeling of uneasiness. We are trying to find some ways, one of our product, because we have other sites where we can get them from.

If we can change them and to reduce some of that impact. Cambodia was doing well for us in the first nine months.

It's a growth country for us, but definitely this is having some serious impacts. We're looking at all the ways to ensure that the impact is not major, doesn't have a major impact on our business, overall impact on our business.

That's our effort. Being there for 30 years and having a brand that's established, and people have a very good relationship with Mega, there is going to be an impact.

I can't say that we could have probably done a little bit better and money could have been better by a couple of but something beyond our control. Only we are minimizing any kind of impact on the company.

That's risk minimization is there. So

19th of October, we are still double digits.

Still double digits. We could have done a lot better, we think, because the kind of work that's going on there.

Distribution, to be honest, it's there. If you look at the contribution to bottom line out of distribution, Cambodia is, though we look at turnover, yeah, the bottom line impact and something drops also not very major, right,

those figures.

Not very major on the bottom line, so.

Overall distribution business put together in all markets is around 15% to 17%.

If you think of it, if the brand business doesn't get affected, if we can protect it, right, and that's where you see Mega Why are we getting to these numbers, the brand business? In next five years, if we invest more time, more money on focusing and building larger brand in the categories we are, not only just to create 200 products, but in the areas we are in, and that happened, the chances of delivering this bottom line and making it a lot better is much higher.

There will be some impact in Cambodia. I'm not saying we can't stop that because if shops don't keep, shops don't buy.

If consumers are still buying the products because they've been using it, they're not anti yet. If it becomes very bad and the government banned, but that ban hasn't come.

We can still import. The borders are closed, but we're still allowed to import.

We can get products by sea, by air, it's not bad.

Right. Thank you.

Khun Yuwadee, you can please ask your questions.

Yes. I have two questions about Myanmar.

I guess Khun Vivek has answered a bit, but I just would like to be more specific. In third quarter, we saw the distribution sales recover Q-on-Q about 40%.

We know that it still declined year-on-year. What caused the change in Q-on-Q?

I think, as I said, you should look at annualized. Don't look at Q-on-Q alone because maybe that quarter last year had no stocks, the sales were low.

The other quarter, we had enough stocks. When you have stocks in Myanmar, we have stocks, it's the same thing.

You have stocks available, sales go up because they are known brands, they are existing brands, and there's a demand in the market. Okay.

Demand being replaced by cheap products because there's not enough money, that's one. We have both.

We are in the low end of the business also because we have the high-volume, low-end business with our partner. We do that.

We have the other side, which is the high end. I think quarter to quarter may not be very right in a country like Myanmar, which depends on availability of import licenses and stocks being available on the ground.

With that situation, if we look at annually, it's down. If you look at overall compared to last year, it's up, it's stabilized.

It's not declining anymore, stabilized and now getting slightly better, right? If I look at the nine months versus nine months, Yeah.

It is better, right, compared H1 H1 the decline was 34%. Now it is down to around 26%, 27%.

Overall. Overall.

Compared to H1 compared to nine months last year and this year,

yeah.

Yeah. Decline does not mean there's an improvement, it's still declined compared to that period.

So

Fourth quarter anyway was very low. If we are able to maintain our third quarter and the fourth quarter, probably the decline will even come

Even be less.

Even less.

Overall, you are going to get less declined compared because fourth quarter was lower last year. When you add up, because based on our knowledge and stocks we have, we believe that there'll be no decline.

I think the numbers will look even better if you look at annualized basis.

When you will see the distribution gross sales gross in quarter one or what can be the case?

No, I'm saying annualized for 2025 compared to '24, we should have a lower decline. Today it was showing 26%.

At the end of the year, it may only be 18%, 17%, 18%, we don't know, but it'll not be as high as 34% as you were seeing in the first six months. That's part one.

Next year is a different story. We are hoping if this remains and there is availability of funds, then this will become the base.

'25 will be the base. If this is 100, we hope to continue doing at least 100 or a little bit better than 100 next year.

100 will become 110 next year, 105 next year, there'll be growth over this base. Then we'll compare '25 base for going forward.

Okay. Thank you.

Khun Naruemon, you may please raise your questions, please.

Yes, kha. Sorry for noisy na kha, I'm outside office.

Back on the branded business that you focus, right? You said that branded business growth is low double digit, including FX, right?

What would be the optimal sustainable growth for branded business? What would be the best growth from your effort in the next, for example, next year?

I think, as I mentioned, we're still projecting that based on what we have done in nine months, we should be able to maintain that higher than 10% rate. That's our feeling, in that 10%, but not high double digits, but low double-digit range.

That's for this year. Next year onwards, we have a plan to grow our business, and we are working on that strategy.

As I mentioned, we want to double our business in five years' time on the branded side. That's the goal.

In order to do that, somewhere there, 80% to 100%, we will have to grow in the range of 10% plus, 10% to 15% annualized in the coming years. That's what we are aiming for.

And '26 also should see that 10% in 10% to 15%. It won't all happen at one time.

I think with the focus that we are bringing into product range, into the categories that we are in, and the investments we are making, we hope to see that 10% to 15% annual growth over the next five years. That's the internal plan.

Kha.

Yeah. Kha.

Okay.

To double to get 80% to 100% over '25 numbers, so that's the plan.

Yes, kha. Because previously we talked about mid to high single digit of the growth, right?

This year, your performance has been much better than expected. I assume that it has been because of the new NPD launch.

Is that right? We could expect at least 10% to 15%

Not only new NPDs, one. We are getting in the categories we are in, we are extending more products.

In the categories we're already there, we are investing more time and effort. We are bringing more focus

Oh, ramp up. Kha.

Oh, okay.

Yes. into the branded business and growing it, making them bigger.

As a company, we are now as a strategy going forward, we launch a lot of products, but we are picking certain areas we have the biggest chance to grow and putting money, effort, time, people behind it and make them far bigger than they are today. In the next five years, you may see one product is $50 million in all our markets.

You have four products like this, 50, 40, 30, you'll see sizable chunks of five, six brands giving you $200 million, $300 million of business. That kind of strategy, and in that, there are extension.

Some may be a gel, some may be a tablet, some may be an effervescent line extension for children, adults, or different formats, but in that one category. There's going to be a lot more focus that we have put as a strategy in going forward five years to build Mega We Care brand with an ecosystem for consumer health in pharmacies, in medical hospitals, in clinics, and direct to consumer, as well as our consumer-centric, holistic approach on wellness with the Wellness We Care Center, training people to stay healthy so that they manage their disease, their lifestyle better.

That's where Mega is going to play and put all these things together with platforms, We Care platform, on the handhelds, etc., apps, application we have for consumers to manage their health better. It's a plan, is a part of our larger direction to build the branded business far bigger than it is today.

When I say doubling, I'm talking about branded. I'm not talking as much about distribution.

Distribution will grow whatever rate it grows between Cambodia, Vietnam, and Myanmar as we can get more import license, because Myanmar was the largest contributor with this. Even if it remains flat or grows 4%, 5%, 10% at the rate of licenses, you'll see growth.

The bigger focus of Mega will be that is part B. Part A will be here, so.

Cambodia, Myanmar, Vietnam also our distribution 80% is our own business, about 80%, 75% is our own distribution, right? Majority.

20%, 30% we do other brand, other companies. That's the only business.

You will see a lot more focus on the company, the whole company, from software, hardware, intelligence that we are putting behind it into building the branded business. That's where we believe that you will see growth next year and going forward.

It may not be exact every year, but in that 10% to 15% range annualized basis for us to get to that 80% to 100% in the next five years. I hope it makes sense.

Dai kha.

Khrap. Khun

Thanapol.

Khun Thanaporn,

tharm loey khrap. Sawasdee khrap.

Yeah. I have a follow-up question on dividend.

I think your payout ratio has increased to about 70% range in the past two to three years. When you compare to a few years back, you were paying around 50% to 60%.

Is the 70% 70% payout the level we can expect for the next several years?

I think looking at the investments we are making in the range of 3 billion baht, roughly $100 million, and we are also spending money anyway going forward, which we do otherwise as well, marketing. On a billion on a $100 million, $120 million, even if we pay out the money and try to get debt free in the next five years, it's only but 600 million, 800 million baht a year.

If we continue to deliver 2, 2.5 billion baht a year, after all this clearing up, we still believe we can deliver that 60% dividend that we've been paying because there's no other need for cash. We're a debt-free company, right?

What we are building is what we are building for tomorrow, and it's going to come from internal cash flows as well as with some borrowings. Our ability to pay out what we have promised 50% above, and I think we're already doing 60%, 70% in that range.

So 60% 50%, 60% should not be a problem unless something really goes wrong. I don't think so.

Looking at the number, looking at our bottom line, annual profitability, and whatever we have to cover for all the investments we have made, you can also have a look, it makes a lot of logical sense there.

Cash on hand.

Cash in hand. Looking at all that, there's a very high likelihood that we should be able to pay that 60%, 50%, 60%.

Okay. Yeah.

How should I ask this? In the past, you were a lot more active in acquiring new formulas.

Right, I remember you used to have a lot of M&A back then. For the past several years, I think you have shifted into expanding your manufacturing footprint.

For example, in Indonesia, the upcoming one in Vietnam and Myanmar. Strategically, are you not looking to acquire any more formulas and look to expand manufacturing footprint instead?

How should we think about that?

I don't think that's 100 all 100% correct. I think we acquired some brands.

We have never done very big acquisitions as Eugica or Biolife or, but we acquired company in Indonesia. To enter Indonesia, there's no option, you have to manufacture.

If you want to play there, you cannot register products, whole products. You have to make locally, and only a local company can register products, simple.

In order to play in Indonesia, you have no choice. Myanmar, with the import restriction in order to win long term and being a branded business there for 30 years and the kind of brand we have in the country, if the country remains, 40 million people also remain, and there's a business to be had where we have $80 million, $100 million of business, having our possibility to increase and grow our business is high.

Having a manufacturing site there makes it easier for you to import, manufacture, supply. All these things are there, it's been put in an industrial zone.

There's a reason to do it. At the same time, there will be new products in it.

We are registering new products for imports. Wherever we cannot, we are also going to manufacture them locally, all new pipeline that we are making for the Myanmar market and maybe some of the patented drugs, etc., that we can export.

With this site, we can also export to other markets. What Thailand makes goes out to other countries.

What Myanmar makes may also be sold in Thailand because it's also the plants are EU GMP, they're world-class facilities, and they have good dossiers. We will still continue to acquire new products.

We'll still continue to do both, local production and many things we don't produce ourselves. Injectables, we don't produce.

Cartridges, we don't make. Inhalers, we don't make.

We still buy many things from outside. Many drugs also, we don't develop everything ourselves.

This will carry on. This hybrid mechanism, right product coming from the right source to get it in the market on time, will carry on.

That's one part. Acquisition, if we find good setups, we keep looking.

It comes to me, if I get a good brand that fits into our portfolio in the consumer health area or pharma area that fits it in the markets where we are, we continue to look at it. We don't say no to it.

We are constantly looking at a few brands. We had looked recently also, in the past hasn't worked, but we look when the things come to us in the markets where we are.

That's going as an ongoing thing. That's the reason we are building.

Indonesia, we have a reason. Myanmar, we have a reason.

Vietnam also, we have a reason. It's a large pharma business for us with all the changes and government buying and all that happening.

They have all this EU GMP and Group 1, Group 2, etc., requirements and raising the bar. There is a certain criteria that if the three products are made in this category, they will buy what is made locally.

Imported products then don't get quotas, etc. From a long-term perspective, there is a drive in the country to localize, most of the countries are doing that.

Protectionism is in a different manner. It's not exactly by duty or this, but there are different ways to protect by quotas or system by having requirements to be able to play in the tender in the market, right?

We are doing both, protecting our long-term interest in the country so that we can also and build it and grow it. With these reasons, we are building.

Another pipeline we are still creating. We haven't stopped looking at in the right areas.

Though we are focusing a lot on certain categories where we are really planning to grow and make them bigger. It's also there's a strategy road plan and road map, and in those areas, we are developing products and growing them and adding new products to those areas.

That whole process is still very, very active.

Thank you. That's very helpful.

My last question is on tax. When you make investments in Indonesia, Vietnam, Myanmar, are there any tax incentives or benefits that you expect to get?

There are tax incentives, but at this moment, it is not something we are factoring in because those will come in the long term once those plants have commercial production started, right? That's when some benefits will kick in.

At this moment, we are not really looking at that. Whatever growth has been projected is to be projected organically without considering the tax benefits.

As and when we have more detailed information on that, we'll make a disclosure on that.

Generally, you can expect tax to be in the range of 20%, 21% going forward, unless some BOI privileges in Thailand if we get in the near. If

the government is looking at many things, if you do ABCD, you invest in this area, but it hasn't been materialized yet. We are always looking at it, we have not given that up.

That's not the only thing, because we still have to run a clean business. Today with the global tax, all these requirements, every country wants to collect tax locally.

I think this will remain that 20 like Manoj is saying, 20%, 21%, so.

Thank you.

Calvin.

Hi. Thank you for taking my question.

Maybe my question would be, can you share or remind us what is our key subsegments for the branded business and also the distribution business? Thank you.

Distribution business, we do pharma and consumer, both in Myanmar, being the largest part. Consumer is FMCG.

We do L'Oréal, we do skin care, and we do nutrition. These are the two large areas we work in Myanmar and other countries, all of them.

That's all. Nutrition and skin care.

The other part is pure pharma. In pharma, we have medicines, drugs, and vitamins or herbal medicines, etc.

This is a distribution part of our business, too. The large part of our business is still pharma, distribution in three countries.

Other countries, we do no distribution. Myanmar was the largest, but with all the changes of 34% decline over last year, etc., and now stabilizing, it still remains the largest in spite of all that.

Cambodia is also doing well in its own size. That's the distribution business.

We'll probably stay there in only three countries and do what we are doing today where we are, and more focus on the few principals who are partnered with us so that we can have imports and we can continue to serve them better, and that's our focus remains there in that area. We're not trying to find new principals running around, but growing what we have in hand.

That's the clear focus. As far as branded business, we have two businesses, as I mentioned, pharmaceutical healthcare, which is purely drugs, prescription sold by hospital, doctor, clinics.

In that categories, we play in certain categories where we have long-term investments, we have products in those categories, we have been there for a long time. We have teams and focus in those areas, urology, osteoporosis, some of these areas, derma, there are all these areas, respiratory.

We have focus in some of these areas in pure pharma area. Then the other part, we are in GI, gut health care in some countries, not every country, but some countries.

On the consumer side, we also have similarly cold, cough, pain, gut health, allergy, and similar areas where we also focus on liver health and areas where we are even got supplements and drugs in both areas, they cross over between complementary medicine and drugs. Those are certain areas where Mega focus is on.

A large part of our business comes from there. We don't declare by therapy, but as I said, our focus is on certain areas where we have size and we hope to grow them and make them bigger than they are today.

That's our drug and the consumer business. Consumer health business is about 50%, 60% today, pharma is 40%.

Going forward, we think, being drug by the size it is, probably become 50-50 in the next few years' time.

Thank you. Really helpful.

For our target, right, for the branded business to double in five years, do we expect a lot of contribution from the overseas market that we are expanding to?

I think they're all significant. We are within the 33 markets, probably there are 10 or 18 markets we say very are sizable.

Southeast Asia still will be a large part in this game. Can't take it out.

Thailand, Vietnam, Malaysia, Indonesia, Philippines, Myanmar, and Cambodia will contribute a large part to it. As it all grows, they will also grow.

They still have a large because we have established team, established products, and the potential to grow is there. Africa, between East and West Africa, Nigeria, Ghana, Ethiopia, Kenya, Uganda, Tanzania will also contribute significantly and will become larger than what they are.

This is a second area. Percentage because of the number, if all grow, they will also probably remain similar percentage because Asia also grows faster.

They also grow faster, that is only going to have 1% or 2%, 3% because they're still 16% to 18%. Even if they grow at 20%, they'll only become 20%, they won't become 50%, but they will grow at a much faster rate.

Their rate growth will be higher. Then we have the outlier.

There are Peru and Colombia, which is also growing and doing very well, Peru, Colombia, and we are looking at some other smaller market. These are the two big markets.

Ukraine with the war, still doing well, but let's see how things change. If the Ukraine and Uzbekistan are two other markets which can also be sizable.

At the moment, Uzbekistan, we're investing, we are building brands, registering products, still in investment mode. We should see the next two, three years how that grows.

It's also potential, but still small. The impact of these two markets, we don't see very huge impact because of the situation.

If situation change, we'll hear from them. Largely, again, Southeast Asia, Sub-Saharan Africa, and the outliers in Latin America, these are going to be the growth drivers.

If they all grow, you'll see ratios may slightly 2%, 3% here and there, but otherwise it'll not be very far away.

Understood. Thank you.

Do we have any other questions?

I think we're getting close to the time, so.

Thank you very much, everyone, for participating in this call. If you have any further questions, you can write back to us or contact myself or Francis, and we will be more than happy to answer your questions.

Thank you, and have a good weekend. Bye-bye.

Thank you.

Thank you. Sawasdee khrap.

Khob khun mak khrap. Sawasdee khrap.

Thank you.