Ladies and gentlemen, good day and welcome to the JB Pharma's Q4 FY 2024 earnings conference call, as on the 21st of May, 2024. As a reminder, all participant lines will be in the listen-only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference, please signal an operator by pressing star and then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Jason D'souza, Executive Vice President at JB Pharma. Thank you, and over to you, sir. Thank you, Donovan. Welcome to the earnings call of JB Pharma. We have with us today, Nikhil Chopra, CEO, and Whole Time Director, Kunal Khanna, President, Operations, and Narayan Saraf, the CFO at JB Chemicals and Pharmaceuticals Limited. Before we begin, I would like to state that some of the statement in today's discussion may be forward-looking in nature and may involve certain risks and uncertainties. A detailed statement in this regard is available in the Q4 results presentation that has been sent to you earlier. I would like to now hand over the floor to Mr. Nikhil Chopra, to begin the proceedings for the call and give us his opening comments. Thank you, Jason, and good afternoon to all, all of you, and thank you for joining us to discuss JB Pharma's quarter four and full year performance for FY 2024. During today's interaction, I shall walk you through the business performance for Q4 as well as the full financial year 2024, and shall throw some light on our outlook for the business for the coming year. Dear friends, at the onset, I am pleased to share that JB Pharma achieved all-round outperformance for quarter four, as well as for FY 2024. Our reported revenue for quarter four, FY 2024, was INR 862 crores, recording healthy growth of 13% year-on-year, and closed the year with INR 3,484 crores of revenue, registering growth of 11%. Overall, top line was impacted by strategic choices we made with respect to our South Africa business, excluding which, revenues grew at 17% in quarter four and 14% in FY 2024. When it comes to profitability, our cost optimization efforts and favorable product mix aided in improving it significantly. Gross profit margins expanded by 130 basis points in Q4 FY 2024 to 65.2%, and for the year it expanded by 320 basis points to 66.1%. Operating EBITDA, which is EBITDA, excluding non-cash ESOP cost, witnessed year-on-year improvement to 23%, to INR 939 crores in FY 2024, and 16% in Q4 FY 2024 to INR 210 crores. JB's balance sheet further strengthened in the year, and I'm glad to state that we are now net cash positive company. There has been a reduction in gross debt, which was INR 357 crore as on 31st March, 2024, versus INR 548 crore as on 31st March, 2023. ROCE has also improved to 27% in FY 2024, versus 21% in FY 2023. Now, let me take your attention to our business performance, starting with the domestic business, which grew strong to INR 465 crore in quarter four, registering growth of 22% and INR 1,897 crore in FY 2024, recording a healthy growth of 16%. This was driven by strong brand portfolio, meticulous execution on raising the field productivities and higher share of chronic products. I am pleased to inform you that the ophthalmology portfolio integrated smoothly with JB Pharma's DNA in January 2024, and has already started delivering growth. We remain optimistic about our, our ophthalmological business. Our MR productivity metrics has almost doubled in last 4 years, which stands to INR 7 lakhs at the end of FY 2024, which is per month, per medical rep. JB has retained its position as one of the fastest growing company in top 25 in IPM, and we have outperformed IPM at 10% versus 7.6% industry growth as per IQVIA MAT, March 2024 data. I am also glad to announce that the company's five biggest brands now rank among the top 150 in the industry, according to IQVIA MAT, March 2024, which is Rantac, Metrogyl, Cilacar, Cilacar-T, and Nicardia. The portfolio brands that we have acquired has also given us momentum. As per IQVIA MAT, March 2024, our Sporlac franchise recorded a revenue of INR 122 crore, growing at 33% CAGR in three years. Azmarda, our heart failure pill, clocked INR 75 crore, and Razel has shown 24% growth year-over-year. Our latest acquisition of ophthalmology is integrated well and has recorded 11% growth month-over-month in March 2024, as per IQVIA data. I would also like to emphasize that all our big chronic brands have registered strong volume growth. As per IQVIA MAT, March 2024, Cilacar registered volume growth of 10% in FY 2024, Cilacar-T registered 10% volume growth, and Nicardia registered 5% volume growth in FY 2024, and Razel also recorded 22% volume growth in FY 2024. Also, for our in our domestic business, now, the cardiology overall market being as high as $3 billion market. We are now eighth-ranked company, surpassing INR 1,000 crore revenue in our chronic portfolio at March 2024, and we are the fastest-growing company in cardiology market today as March 2024 data. Our international business delivered revenue of INR 397 crores in Q4, FY 2024, and INR 1,587 crores in FY 2024 annually. The international business was impacted by strategic choices we made with respect to South Africa business. Thus, whereas the reported international business revenue at 4% in Q4, without including South Africa business, it showed an impressive growth of 15%. In South Africa, as you will all appreciate, we have lowered our tender business, and we are emphasizing more on improving the mix and margin profile. Today, as compared to three years ago, where the private business contribution was 40%, for the year FY 2024, our private business contribution to South Africa business has gone up to 70%. That is where we stand. U.S. and Russia delivered healthy growth, with international formulations growing at around INR 267 crore for quarter four, FY 2024. CDMO grew at 9% year-on-year to INR 109 crore in quarter four, and closed the year at INR 432 crore in FY 2024. CDMO accounted for 27% of overall international business, as compared to 21% in FY 2021. Also, happy to share the CDMO business has entered; now we have entered into European market with couple of strong consumer players in the world of immunity and cough and cold lozenges. For last three years, JB Pharma has consistently delivered strong performance every year. Overall, the revenue has grown at CAGR 19% since FY 2021, while the domestic business has more than doubled during the same period. JB Pharma marks its presence in some of the most progressive therapies, and 65% of our domestic business gets generated from brands which are in fast-growing therapeutic segments. Besides this, CDMO business almost has doubled over the same period. Domestic business and CDMO business today both contribute around 66%-67%, and the total revenue as against 55% in FY 2021. This has helped operating margins and ROCE. Operating EBITDA has grown at a CAGR of 19%, while operating cash flow have more than doubled to INR 801 crore in FY 2024, from INR 315 crores in FY 2021. Operating cash flow as a percentage to operating EBITDA improved to as high as 85% in FY 2024, from 56% in FY 2021. Net working capital has reduced from 98 days, three years ago, to 87 days in FY 2024. The objective of sharing this data of last three years, in terms of, is more to share with colleagues on the call, is how JB as a company, JB Pharma as a company, has progressed over last three years, consistently, not only in terms of top line, but overall in EBITDA, in profits, and also in net working capital and operating cash flow. Concluding, I would like to state that the domestic business will continue to outperform the IPM by 200-300 basis points. The domestic business share in the overall business will continue to increase, while CDMO business will continue to gain traction. We expect both domestic and CDMO to cumulatively account for 75%-80% of overall business in midterm. Apart from this, the focus for our international formulation business is to further improve profitability with right business mix and a progressive portfolio. With this outlook, I am pleased to revise our operating EBITDA margin guidance in the range of 26%-28%, as against our previous guidance of 25%-27%. This upward revision is despite the addition of ophthalmology portfolio, which will limit gross margins in the short term for the company. I would not like... I would now like to end my opening remarks, and shall be open for the question and answers from all our colleagues on the call. Thank you all for patient hearing. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone phone. If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to please use handsets while asking a question. Ladies and gentlemen, we will now wait for a moment while the question queue assembles. We have the first question from the line of Rashmmi Shetty from Dolat Capital. Please go ahead. Yeah, thanks for the opportunity. And, just want to know a bit more on the CDMO segment that, you know, the first half is normally heavy, second half is normally lower, because the seasonality plays a role. But, despite that, you know, we have given a strong quarter four. So how should we really look at it, you know, next year, in terms of the annual growth? And also whether it would be still episodic in nature, you know, spread across the quarters or, you know, how it would be, whether we would be adding new geographies, whether we would be adding new categories like, you know, now currently we are into immunity and cold and cough, segments. So when are we going to add other products like, you know, motion sickness and the vitamins and all? If you can give more color on it. It's a good question in terms of the world of CDMO. If you look at we could generate the revenue of close to INR 432 crore for the current year. This business should grow between 12%-14%, and you should see probably high teens growth happening quarter three onwards, that is October onwards. That is how our order book is placed. More so, what I spoke earlier, that we have got into the world of immunity and immunity lozenges. Also, our melatonin-based lozenges, you should start seeing them commercialized probably first quarter calendar year FY 2025. Newer geographies, what we have entered is in the world of Europe, where we have commercialized our lozenges, but it's a small start. Probably, God willing, you should see our branded lozenges also available in U.S. market at the end of the year, but it's a very small order, it's a very small start. That is what should happen. But we are very much bullish in terms of this business, which is $50 million, because the capacity that we have is close to 2 billion lozenges, which we can manufacture. Last couple of years, we've been manufactured close to 1 billion lozenges, and this business almost has doubled last to last year. Three and a half years ago, this business was contributing 5% of the revenue, $10 billion. Today, it is contributing 12% of the revenue. You have to also understand that this business has got high gestation period. It takes time for any new lozenges to being commercialized, because the way it works, at, with the reference sample, we have to match the product, develop the product, share with our partners. They will do their own research in the market, come back to us, there'll be more tweakings to the product. That is how this world behaves. But first-in-class immunity lozenges are already there in the market. Melatonin lozenges, you should start seeing commercializing probably year-end or FY current FY 2025 calendar starting year. And probably also you should see our pain lozenges, flurbiprofen, which should also see commercialization probably sometime in quarter two FY 2025. That is where we stand as a company in the world of CDMO. Okay. And in the U.S., you know, we will be supplying through the channel—I mean, retail channels, or it would be, you know, directly to the partners? You know, how the business model is over there? This is it. It will be same model as what happens in other parts of the world. It will be through one of our partners. Got it. Got it. And, sir, then what would be your CapEx guidance in FY 2025 and FY 2026, like, after, you know, whatever CapEx we have put it in FY 2024? We are already covered for CapEx, as far as our, CDMO business segment is concerned, and specifically with respect to lozenges. We did make some investments in the last one year as well. As stated earlier, we have a capacity of 2 billion lozenges, annualized. Currently, we are running at a run rate of 1 billion lozenges, so we have adequate capacity to kind of ramp up our business. Whatever, bottlenecks were there with respect to packaging, apart from manufacturing, have also been taken care of in the last 12 months. Now it would be just a maintenance CapEx, right? That is correct. Got it. And one more question: in the domestic business, you know, in the presentation you have mentioned that prescription growth is around 20%. Would you like to call out, you know, the ratio of specialists versus GPs, or if you can give some color that, you know, majority, how much, you know, percent is basically coming from the specialists only? We would not like to particularly call out any specialist versus generalist. You know, the growth has been in line with our focused therapy areas. And within focused therapy areas, whichever prescriber category we are covering, we have seen significant growth in that. Specifically, cardiologists, nephrologists, and consulting physicians have been the key growth drivers for us. Got it. So, and just one last question. You know, for your top products, you know, what I'm seeing that, you know, they have really grown very well this year. Just want to know that especially in your Cilacar and your cardiac products, whether you have increased the market share or the entire market, or the entire industry, representative industry, is only growing for those particular products. So overall, if you look at Rashmi, if you look at overall IPM, when you look at 7.6% growth, the overall growth is driven by what is happening in the chronic space, which is 40% of the market, $25 billion market. And there are many other companies who are doing good, good work in the world of chronic space. But if you look at JB, our market share in cilnidipine, our market share in cilnidipine, cilnidipine, telmisartan, all this market share, probably quarter-to-quarter have only gone up. Nicardia, I don't want to tell, because Nicardia we hold 90% market share. Sorry. So maximum what we can achieve only 100%. That is where we stand. But equally, Razel, rosuvastatin, though we are low in the, in the ranking, but the growth has been what I shared earlier, the growth has been, in terms of volume, 20%+ volume growth in, in, in Razel also. And equally, in the world of heart failure, Azmarda, there also our performance has been fair. So overall, our chronic portfolio, what I shared also is, today we have crossed the benchmark of INR 1,000 crore revenue in, in, in cardiology... and we are the fastest growing in the cardiology segment with all our 12 products, which whether it is Cilacar, Cilacar-T, Nicardia, Razel, Azmarda, that is where we stand as a company. Okay. Okay, sir, thank you. That's it from my side. Thank you. Ladies and gentlemen, to ask a question, you may please press star and one. We have the next question from the line of Tausif from BNP Paribas. Please go ahead. Thanks for the opportunity and congrats on a good set of numbers. So my first question is on India business of Heartbeat brands, with already five months into integration. What has been the key learnings and challenges you have been seeing? Because, this is something, a new segment for JB. See, the good thing is that there has been seamless transition, and the fact remains that when we acquired the brands, there was team transition also, which happened, right? So we have got good support from our principal, you know, partner, Novartis, as well, in managing this transition. The products are pretty much the same. The sourcing of these products have not changed, and we are seeing a good uptake happening because of them entering the JB DNA. So we are fairly comfortable with what we have seen in the last 2-3 months, and are very, very optimistic about how we will kind of drive growth in this portfolio. Given the fact that we believe that these were under-leveraged and under-invested brands, you know, earlier. Sir, any plans to increase the MR account in this business? Yes. So we have plans to increase the MR headcount, going forward. Within the, in the erstwhile organization, this portfolio was being promoted by close to 75. Already the ramp-up has happened, and we have gone up to close to 104. And slowly but gradually, in the coming year, we will kind of further ramp this up. But this is a steady-state number, which we will work with for the next 6-8 months. So my second question on the CDMO segment, you have guided a growth of 13%-15% for FY 2025. Can you highlight, means, this large part of growth will be driven by new product launches, or there is still room for going to new, directly new region? It will be, it will be a combination of both- Mm-hmm. In terms of the volume growth that you will see with some of our existing partners, existing products. And that is why I told you, in second half of the year, probably October onwards, you will start seeing some element of growth coming from our new launches which will happen. And at the right time, we'll be more than happy to share with the group. Thanks, and get back in the queue. Thank you. The next question comes from the line of Tanmay Gandhi from Investec. Please go ahead. Hi. Thanks, sir, for taking my question. Sir, firstly, on the India business, right, so you have guided for overall revenue growth of 12%-14%, but the recently acquired Ophthal portfolio itself should lead to 5%-6% growth in FY 2025, right? So, so, so is your guidance on the organic side, or that includes Ophthal portfolio also? This growth, 12%-14%, is outside Ophthal. Okay. So, is it fair to assume that overall consolidated growth could be in high teens? Yeah, you can take that number. Yeah. Okay, sure. And so secondly, now, now that we have turned, net cash positive, right, so are you again, on the lookout for acquisitions? And, and again, you know, we have been seeing a lot of in-licensing deals announced by other companies as well, right? So, are you also, you know, looking for those kind of opportunities, or you are more, keen on acquiring brands? It will be a mix of all things happening across. We'll first of all, the focus will be on what we are trying to do with as is, the portfolio that we have got. How can we make it big? Equally, we are open to anything which is available in the market at the right value, and if we think that we can grow it, make it grow better as compared to where it stands. And thirdly, there are some initiatives that we have put that we being now a dominant company in the area of cardiology, probiotics, ophthalmology, probably, God willing, we may get into the world of in-licensing, but it will take its own time. Yeah. And sir, lastly, what kind of, you know, contribution are we expecting from new launches over the next two years? If you look at this year, our new product contribution to overall growth is as at 3%, which will continue to happen. Okay. And sir, so far, I think this was largely led by our legacy brands, right, where we have, you know, extended the life cycle through new SKUs, right? So will that continue, or you are planning to launch under new brand franchise or new product categories? 70%-80%, you will see us doing much more in the existing therapeutic segments where we are present. Okay, got it. Thank you. Yeah. Thank you. The next question is from the line of Abdulk ader Puranwala from ICICI Securities. Please go ahead. Yeah, hi. Sir, thank you for the opportunity. So my first question is pertaining to the MR productivity. So in the last two years, if you see, we have increased the MR count, we added close to 500 MR, and, you know, despite that, the productivity has been stuck. So when going ahead, how should we, you know, see the productivity ramp up happening here, with and without the Ophthal portfolio? And in terms of the newly added MRs, you know, is the entire traction visible in this number, what you posted in 2024, or you know, that is still expected to jump in the years ahead? ... So our productivity what I shared in my commentary is now close to INR 7 lakh, and you should expect the productivity as is, without any addition, to grow at around 8%-10%. Sure, sure. Sure. And so my second question is with regards to the growth of India business, as you're guiding, would be, say, somewhere around in mid-teens. And on the CDMO side, also similar kind of a guidance. So, so that is the kind of aspirational rate where we expect to grow in the medium to long term, or, or, you know, it is, there could be some surprise coming from the international market and that will lift up the overall growth? So what I shared in my commentary, India, CDMO, and our emerging market, that is ROW, should grow between 12%-14%. U.S., Russia, South Africa should grow at around high single- digit, around 8%-9%. Overall, you should see us growing as a company, 12%-14% top line, outside the Ophthalmology portfolio. Got it, sir. And sir, just a final one, if I may. So, you know, considering our recent track record on the acquisition side, so, you know, what is that would interest us in terms of the therapeutic, exposure, in the Indian market? You know, any specific asset or any specific therapy where you would like to increase your dominance further? See, one year ago we were not knowing that we will do a, we'll do acquisition in the world of ophthalmology. It all will depend upon what is available in the market and does it suit us. We basically go for a quality asset, not, not looking at as is, whether the asset is growing or not. And if you look- if, if we see any opportunity of an asset which is available, which is quality, the market is growing at a good valuation that we can get, we will certainly have a look at it. Sure. And just a final one, if I may. So in the U.S. front, on the CDMO business, you said there would be a small order which you would be dispatching this year. So any outlook here, I mean, is, you know, some kind of a batch order quantity where, you know, the customer initially wants to try and then that will relate to some bit of a order scale-up? Or, you know, how should we look at the U.S. as an opportunity for the CDMO business? It's too early to comment on. We are working on a couple of projects, one of which is likely to get commercialized soon. We'll see how the take-up happens, and we'll have more clarity further going forward. All right, sir. Thank you for answering the questions and wish you all the best. Thank you. Participants who wish to ask questions, may please press star and one on their touchtone telephones. The next question is from the line of Neelam Punjabi from Perpetuity Ventures. Please go ahead. Yeah, thanks for the opportunity. My first question is on the domestic business. So, just wanted to understand, what would be our expected revenue for our Ophthal business in the next, in FY 2025? For the ophthalmic business, we are targeting monthly revenue run rate of INR 15 crores-INR 16 crores. Got it. And the acute business has been pretty weak recently, so how do we see this business going forward? See, the acute business last year was largely impacted because of, muted season. As we see the trends, we believe that the season will be much better, you know, this year. But of course, we need to have a, guarded approach towards that. If the season is better than last year, then we'll see, certainly see growth coming in from acute as well, apart from our chronic growth. Got it. And on the PCPM side, so since we've reached about seven tags and, you know, you're guided for 8%-9%, 8%-10% growth on that, are we planning to add more field force for the domestic business or generic portfolio? Not as of now, no. Okay. And lastly, what is our targeted, like what would be the ESOP cost for FY 2025? Yeah. The ESOP cost for FY 2025, we are expecting it to be in the range of around INR 40 crores. Okay. That's all from my end. Thank you. Thank you. Participants, if you wish to ask questions, please press star then one. The next question is from the line of Sajal Kapoor, an Individual Investor. Please go ahead. Yeah, hi. I have two questions. First, many Indian branded generic companies are now actively looking at trade generics, and so Lupin is a recent example, right? However, to my knowledge, there is no policy in India where drugs can be dispensed without a prescription or a, or a shopkeeper in a remote village deal directly with patient. So what do you think about this trade generics movement, and that has kind of started with a renewed rigor in the branded generics space, Lupin being an example, recent one, Cipla been doing it for ages. And second, on the CDMO segment, do you believe that medium to long term, the proposed U.S. BIOSECURE Act can help grow this segment significantly? In other words, can BIOSECURE be an additional tailwind for the CDMO? Thank you. Take the first question. See, trade generics is something which is not new. Companies have been evaluating this segment. We have always maintained that it will be a very, very small proportion of our business. You know, whatever we are doing is to evaluate some markets where the conventional distribution model cannot reach, and that's how it will be for us as well. We primarily believe more in branded generic space, where the margins are much more accretive. So it's gonna be a very, very small part for us going forward as well. And we don't see the fundamental nature of the market changing much. Branded generics will continue to be the dominant segment. And on your second question, in terms of U.S. BIOSECURE Act, I think that does not have any impact because much of the lozenges, majority of the lozenges that we supply to our partners are more in, more herbal in nature, and it's a, it's a business where our partners play that in the consumer world. So limited comment that we can give on this. Right, and there is no competition from China that we are facing on the lozenges, right? No, no. So that can have a beneficial advantage. No, no. Okay. Okay. Thank you so much. Thank you. Bye-bye. Thank you. The next question is from the line of Maulik Varia, from B&K Securities. Please go ahead. Hi, sir. Good afternoon. I have one question. Just wanted to check, what is our outlook for Azmarda for FY 2025 and going ahead? And if I'm not wrong, it seems the brand is slightly under pressure as per the IQVIA data. Please correct me if I'm wrong, but I just wanted a little outlook on the same. You're right in terms of assessment of the competitive intensity has increased in this space, and last year saw a huge influx of brands, which did, you know, put our market share under some level of stress and pressure. But the good thing is, if you see the trends over the last four months, our market share, volumes and value have pretty much remained steady. And going forward, we believe that the market will further consolidate only. Any LOE event, you know, the first seven to eight months, there is attention from a lot of players, but then the market pretty much consolidates between the top four to five players, and that's where we operate. Overall, value-wise, if we really look at our share, we are still operating at 14%-15%. The segment is progressive, and we also believe that going forward, we will see a good volume growth in this ARNI segment. So we are fairly confident about the prospects of Azmarda in the future as well. Okay. Okay, sir. Got it. Understood. Thank you. Thank you. Ladies and gentlemen, you may press star and one if you wish to ask a question. The next question is from the line of Alok Dalal, from Jefferies India Private Limited. Please go ahead. Hi. Yes, good, good afternoon, everyone. Question on EBITDA margin. So, Nikhil, what is the guidance for EBITDA margin for FY 2025? Alok, the EBITDA margin, what I shared in my commentary is, 20 ranging, operating EBITDA margin- Mm-hmm. - is 26%-28%. Yeah. And, and what will be the levers for margin improvement over FY 2024? So, as I shared earlier in my commentary, overall the product mix that you will see more improving over a period of time, which has been happening in last couple of years, more gaining market share in our chronic portfolio. Second, overall efficiency program that we continue to run overall in the company, whether it is productivity on the field, larger bed sizes to bring efficiency, better vendor management, that will continue to happen, which will bring savings, which will probably help us to derive better gross margins. And last but not the least, is the journey that we have taken in the South Africa business, where you will see some impact in top line in quarter one this year. But then going ahead, your absolute EBITDA margins will only go up north in the South Africa business, which will overall, in a small significant way, help to range between 26%-28% EBITDA margins for overall as a company. Okay. Nikhil, the Ophthalmology portfolio, will there be a significant improvement in margin in FY 2025 or- No. - towards 2026? No, no, no. So I think- I see. I think that has to be clarified. Next couple of years, that is FY 2025 and 2026, you will see a reverse, probably close to 100, 150 BPS dip in EBITDA margins because of the Ophthal revenue. Cross margins. Cross margins, gross margins, 100 BPS-150 BPS decline you may see, but it will be, it, it will be salvaged by the entire effort that we are putting to improve our overall product mix, to drive better efficiency and to drive better margins in our South Africa and Russia business. When you refer to 26%-28%, this is excluding the ESOP charges, right? Non- Yeah, operating EBITDA. That is what we are looking for, operating EBITDA margins, which is 27% this year of INR 939 crore, EBITDA absolute value that we have, that we have reported, which is 27%. We will be continue to range between 26%-28% operating EBITDA margins. Sure. Okay, thank you for taking my questions. Thank you. Thank you. We have the next question from the line of Rahul Jeewani, from IIFL Institutional Equities. Please go ahead. Yes, sir. Thanks for taking my question. Sir, this operating EBITDA margin guidance of 26%-28%, this obviously has the dilutive impact of the Ophthal acquisition. So can you comment in terms of how your base margins would have been, or would trend excluding the Ophthal portfolio? ... See, the way we have to look at this is, while the gross margin is close to 150, which diluted because of Ophthal, we get very strong operating leverage also on Ophthal business. And some of the other levers which we are talking about in terms of improvement of private tender, private mix in South Africa, overall portfolio mix in our international business, and the fact that, you know, our chronic and the domestic business will continue to grow, will help us, you know, maintain this 26%-28% going forward, despite the dilution happening at a gross margin level. So, yeah, just a clarification on that. So, by that you mean that the Ophthal portfolio does not have any dilutive impact at an EBITDA margin level? That is broadly, yes. What we are saying is, despite its dilution at gross margin level, right, we should be able to maintain this range of 26%-28%. And on the Ophthal side, Rahul, we get strong operating leverage as well. Sure, sir. And on the international portfolio, with the revenue share for the South Africa private market business now increasing to 70%, have we already seen an improvement in profitability in that business playing out, or do you think that would come largely in FY 2025? Yes, that we have already seen, and specifically in H2 of this financial year. Sure. Apart from the South Africa tender business, which you rationalized, on the export side, do you see opportunity to rationalize other parts as well, or that would not be the case going forward? That's a continuous process. We have been doing that. You know, you have seen improvement this year, and, you know, that's a continuous process which we'll strive to kind of, work towards and improve on. Okay. Specifically, if you can comment in terms of Russia business, because that is where I was getting to, that Russia, your own Russia business, your front-end presence. In that business, our margins are lower than company average margins, so any plans of rationalizing the Russia business? In fact, a lot of initiatives were taken in this financial year, and we have seen significant improvement in the profitability for our Russia business. This includes some front-end, you know, optimization as well. And also our, you know, if we club Russia and CIS together, there has been a favorable product mix, you know, for our CIS markets. So we have already seen a significant improvement in terms of operating profitability this year, and that will continue to, you know, we'll continue to witness similar trend going forward as well. Sure, sir. Thank you. That's it from my side. Thank you. We have one question which has come in on the Q&A panel. So in the Sporlac franchise, we have seen very good growth in Lobun and Pubergen. If the management would like to comment on that. Primarily, you know, even when we acquired the probiotic portfolio, we were very clear with Sporlac, we were operating at the mass end of the market, and with, you know, Lobun, specifically, it was the niche market of nephrologists. Because of our strong brand equity with Cilacar, with nephrologists, we were able to capitalize on this opportunity, and that is reflective on the numbers which we see for Lobun. With respect to Pubergen, I think, primarily driving has helped us achieve scale, even in a segment where we were not present. Great. Thanks. Thank you. Participants, if you wish to ask questions, you may press star and one. The next question is from the line of Neelam Punjabi from Perpetuity. Please go ahead. Yeah, thanks for the follow-up. Just wanted to understand, what is the reason for higher other expenses during the quarter? Yeah. Hi, Narayan Saraf. So, very quickly, the reason of the higher other expenses have been that, during the quarter, we have seen a few one-off integration impacts, that was one. And then there have been... Historically, if you see, we clearly see that, they are, the margins do get impacted, at the end of the quarter because of, lower domestic, things. And then there have been few one-off costs which have been incurred, during the year, during the quarter. So this was the mainly three reasons: one, of integration impact, few one-off costs, and, yeah, those were the two major reasons. Yeah. If possible, could you quantify the one-off integration and one-off costs during the quarter? See, we wouldn't really like to quantify. Yeah, you know, it's not substantial in nature. As Narayan mentioned, you know, there was the one-off integration cost. There is a nominal Red Sea phenomenon, because of which our freight costs have gone up. Yeah. The third piece is that largely, if you look at Q4, domestic business tends to be soft in March, and that impacts our margin profile. Overall, other expenses have been inflated because of, nominally because of Red Sea and one-off integration. Got it. Okay. That's all from my end. Thank you. Thank you. The next question is from the line of Harith Ahamed from Avendus Spark. Please go ahead. Hi, thanks for the opportunity. So on the export side, this year, we had called out some challenges, especially in South Africa, and growth for the segment has come in a bit muted at around 6%. So, directionally for FY 2025, how should we think about growth for the export segment? Will we get back to a double-digit growth for the three markets put together? ...So if you look at our export business, which is today contributing 47% of the revenue, two parts of our export business, that is emerging market, which is $50 million, and CDMO, which is $50 million, should grow between 12%-14%. Equally, Russia, South Africa, and U.S. should grow at high single-digit, 8%-9%. So you should see us growing in double-digit for the year FY 2025. Okay. For the CDMO business, in the past, we had talked about the aspiration- Yeah. -to reach $100 million of revenues. Yeah. So, do we—does that number still hold, and do we have any timelines for that? So that is a journey. That is what I shared earlier. Probably that is a journey that we want to travel for next 3- 5 years, with lot of newer projects being on, newer partners, newer geographies, which continue to happen. And you should start seeing what we have been talking about, all these newer initiatives happening in the world of CDMO, probably October FY 2024 onwards, and that will continue to happen. And our aspiration of $100 million still holds. Okay. And last one: on the Novartis portfolio, can you remind us on how much of the ophthalmic market is covered by the acquired portfolio? And when we think in terms of growth, what exactly is the strategy? Are we looking to add MRs? Are we looking to expand coverage in the space? So, can you talk a little about that? So ophthalmology portfolio today in India is close to INR 4,000 crore, growing at 14%. We, the portfolio that we have got, which is in the world of glaucoma, pain, antibiotic, antiallergic, covers close to INR 2,800 crore market. Unfortunately, this portfolio of Novartis was not growing, probably for the last couple of years. But, the aspiration is to grow in the current year, that is FY 2025, better than the ophthalmology market growth. And earlier, I think it was shared that, around close to 70+ people joined us from Novartis, and today we have a team of 104 medical reps on the ground. Pan India, we have coverage. We would also like to expand our portfolio in the coming time in the world of dry eyes, where the portfolio is not there, anti-ox, antioxidants for ophthalmology. We may get into mid- to long-term in-licensing, partnering for some biologics in the world of ophthalmology. Those all things, plan we have put in place. We are very much optimistic in terms of how tomorrow at least we can grow better than the market and improve our penetration with quality eye drops that we have got. Yeah. Thank you, that, that's all from my side. Thanks for taking this. Thank you. Ladies and gentlemen, that was the last question. I would now like to hand the conference over to the CEO, Mr. Nikhil Chopra, for closing comments. Over to you, sir. First of all, thank you all for participating in today's call. Once again, emphasizing on the guidance that we have been giving for the company, which is short to mid-term. Overall business growing at around 12%-14%, EBITDA growing at around 16%-18%, and EBITDA margins, operating EBITDA margins between 26%-28%. That is where we stand. And both India and CDMO will contribute overall to the growth of the company and overall, generating gross margins close to, close to 65% for the, for the coming two years. That is where we stand as a company. Net-net, what we want to do is to overall improve our market share in the portfolio, progressive portfolio that we have today got in India, which is in the world of cardiology, probiotics, pediatrics, respiratory, ophthalmology. Equally, focus and take our CDMO business up north and also look at how do we start launching some of the new products in our emerging market, ROW markets, where we have been doing filings for our products. Net-net, creating value for the stakeholders, looking at how more and more number of patients, not only in India but globally, are treated with the help of medicines which are coming from the house of JB. This is what I would like to conclude. Thank you all once again for participating and patient hearing, and for the questions that have been asked. Thank you. Thank you. Thank you. On behalf of JB Pharma, that concludes this conference. Thank you all for joining us. You may now disconnect your lines. Thank you.