Ladies and gentlemen, good day, and welcome to the Q4 FY 2024 earnings conference call of Gufic Biosciences Limited. As a reminder, all participants' lines will be in the listen-only mode, and anyone who wishes to ask a question may press star and one on their touchtone phone. To remove yourself, you may press star and two. Should you need assistance during the conference call, please signal an operator by pressing star and zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr... Over to Ms. Ami Shah, the Company Secretary. Thank you, and over to you, ma'am. Thank you, Manuja. Very good evening to all ladies and gentlemen, and a warm welcome to Gufic Biosciences Limited Earnings Conference Call for the fourth quarter and financial year 2023-2024. We have with us today Mr. Pranav Choksi, Chief Executive Officer and Whole Time Director, Mr. Devkinandan Roongta, Chief Financial Officer, and Mr. Avik Das from investor relations team, to give the highlights of the business and financial performance of the company, and to take questions, if any. Before we begin, I would like to say that some of the statements that will be made in today's discussion may be forward-looking in nature. It is subject to unfortunate risks and uncertainties, and the actual results could materially differ. The company undertakes no obligations to update or revise any forward-looking statements, whether as a result of new information or future events or otherwise. We'll now begin the call with the opening remarks from Mr. Avik, followed by a financial overview from Mr. Roongta. Thereafter, we'll have the floor open for the interactive Q&A sessions. The participants are requested to ask two questions in the initial round. I'll now request Avik for the opening remarks. Thank you. Thank you, Ami, and good evening, everyone, and thank you for joining us on this investor call to discuss our Q4 performance. I'm pleased to provide an update on the significant developments and achievements that are taking place this quarter at Gufic Biosciences, and I will begin with the Indore CapEx update. We have made substantial progress with our manufacturing facility in Indore. Our media fill validation studies are underway, ensuring the robustness of our aseptic process. This validation is crucial for minimizing product batch rejections and streamlining the approval processes. We are confident that this will lead to faster regulatory approval and certification, and also enhance our production quality as well as reliability. Moreover, a pre-audit by a distinguished ex-international inspector has further helped us prepare for the upcoming regulatory inspections. Their expertise and practical recommendations have helped us improve our compliances and operational processes, setting the stage for hopefully a smoother future inspections and fewer regulatory hurdles once we commence the regulatory audits. On the product development front at Indore, our team has been actively working on over 14 niche products. We are developing a wide array of products, expanding our portfolio from antibacterials and antifungals to molecules used in the treatment of schizophrenia and bipolar disorder, to HIV treatment and innovative products for neuropathic pain management. I'll quickly give an update of the various business divisions that we have now, starting with Critical Care division. Our Critical Care division has sustained growth through enhanced market penetration and leadership in niche antibacterial and antifungal products. We have successfully penetrated over 2,000 hospitals now, with brands like Guficap, micafungin, Micafung, Polific, Ticofic, and Nurofic becoming preferred choices among medical professionals as per the market data that's available to us. We are also proud to introduce Sankalp. This is Gufic's first patient assistance program. This initiative supports economically strained patients requiring long-term therapy, providing free therapy that will be delivered to their doorstep. With 50 doctors and 500 patients expected to participate, Sankalp will definitely enhance patient engagement and build trust among healthcare providers. We've also done some differentiated product launches in this division. So we've launched the Nurofic dual chamber bag. This is an innovative closed drug delivery system that ensures zero human intervention, setting a very new standard in medication safety and efficacy. This innovation is strengthening the market position in critical care drugs, and we intend to add more and more molecules to this drug delivery system, which is very proprietary to Gufic at the moment in the market. Another notable launch was Dalbafic, which is a second generation lipoglycopeptide antibiotic, which is used for serious bacterial infections. This is also a once a week dosing frequency, which will reduce the treatment burden on patients and the healthcare providers. We have a range of unique products in our pipeline, planned in this division, which includes a next generation tetracycline, a next generation carbapenem, a very, I mean, a next generation quinolone, as well as an azole. Now coming to our Ferticare division, our assisted reproductive drug portfolio has been strengthening, with the planned launch of differentiated products such as the ultra-high-purified HMG, the recombinant FSH. These products offer superior efficacy and safety, addressing the complex fertility challenges and demonstrating significant growth potential in the domestic market. We've also introduced, Biofolin, which is effective in recurrent implantation failure. Now, coming to Sparsh. The Sparsh division continues to excel with its direct-to-hospital distribution model. We have established business channels with over 1,400 hospitals. And in this division, we have complete visibility on the tertiary sales, and we've also noticed a very high retention rate of customers. And this transparency and efficiency have positioned us well to launch, more value-added products and expand our offerings. And we mentioned in our presentation the kind of therapeutic segments that we're adding to Sparsh in the coming quarters. Now a quick update on the Aesthederm division. Our Aesthederm division is growing through knowledge-sharing and unique training programs, like the GROW program, which democratizes the use of botulinum toxin and expands our market reach. We've also achieved milestones such as hosting face of India's first hands-on cadaver and injectable workshop, and publishing comparative studies on botulinum toxin Type A with other leading brands, of botulinum toxin in the market. A quick update on the NeuroCare division. Our NeuroCare division has successfully launched Zarbot, the first Indian botulinum toxin of international pedigree. Zarbot has quickly gained the confidence of leading neurologists, with acceptance and prescriptions by over 100 leading neurologists in India within a year of launch. And we are continuously conducting scientific activities, workshops, and injector programs to expand Zarbot's user base and reinforce its position as a suitable alternative for neurologists. Now I'll give you all a quick update on our mass market divisions, which includes Spark, Stellar, and the healthcare division. Here we've conducted various knowledge-sharing programs. We've also conducted diagnostic camps across India. For our Stretchnil product, which is a very unique product for stretch marks, we've come up with a proprietary device which helps us measure the stretch mark and which can help us to be proactive in ensuring the right treatment, because as we know, stretch marks are irreversible. We also filed a patent for this particular device. We have some very interesting products, which are set for launch in these divisions. We mentioned them in our presentations. One of the notable ones are the extended-release diaper rash, which is a very exciting market. Now a quick update on the international business. Our international business strategy has yielded new product approvals and registrations across a diverse range of countries that include UK, Australia, South Africa, Nepal, Sri Lanka, Philippines, Thailand, as well as Myanmar. With over 200 products now registered across regulated and semi-regulated markets and another 150-odd products in the pipeline, we are well positioned to leverage our existing formulations and target new market opportunities. We also have a very exciting announcement about a unique pain management solution, which we've been licensed in the past quarter. This is a synthetic analgesic with a mechanism of action that is similar to an opioid, but without the associated side effects. This product acts as both an agonist as well as an antagonist and opioid receptor that provides effective pain relief while reducing the risk of respiratory depression, which is the most common side effect of opioid pain management options. This is also a once-a-week pain management product, which would mean it has a lower abuse potential and is particularly suitable for managing moderate to severe pain, including post-operative pain. There is a patent for this product, and the patent period for this product in India is till 2031. In conclusion, Q4 has been a quarter of growth and strategic advancement for Gufic. Our dedicated efforts in product development, market penetration, regulatory compliance, and patient engagement are driving our way ahead. We remain very committed to delivering innovative and high-quality healthcare solutions while enhancing value for our stakeholders. Thank you all for your continued support and confidence in Gufic Biosciences. I look forward to addressing questions later in the Q&A. This concludes my update, and I'll now hand over the call to Mr. Roongta for the financial highlights and updates. Thank you, Avik. I was just going to highlight the financial results for the Q4 of financial year 2024 versus the Q4 of financial 2023. I will also going to highlight the financial results of 2024 versus the financial results of 2023. The total revenue for Q4 of this financial year is INR 194.9 crore, compared to INR 173 crore of Q4 for financial year 2023. The EBITDA for the current Q4 is INR 34.6 crore, compared to the Q4 of last year, INR 32.8 crore. The EBITDA margin for current Q4 is 17.8%, whereas the Q4 for financial year 2023, it was 18.9%. The profit before tax for the Q4 for this financial year is INR 26.6 crore, compared to Q4 of financial year 2023, was INR 23.9 crore. The tax margin for the current Q4 of the current financial year is 13.6%. Q4 of last financial year was 13.8%. The profit before tax for the current financial year, INR 19.5 crore. The Q4 of financial year 2023, it was INR 18.1 crore, INR 18.1 crore. The tax margin for the Q4 is 10%. The Q4 of last financial year, tax margin was 10.5%. Now, I highlight the financial results for financial year 2024 versus 2023. The total revenue from the operation is INR 806.70 crore, compared to INR 690.6 crore during the financial year 2023. The EBITDA margin for the financial year 2024 is INR 148.05 crore, compared to INR 137.2 crore of last financial year. The EBITDA margin for current financial year, that is 2024, is 18.4%, compared to financial year 2023, it was 19.9%. The profit before tax for the current financial year, 2024, is INR 115.7 crore, where the financial year 2023, it was INR 106.7 crore. The tax margin for the current financial year, 2024, is 14.3%. The financial year 2023, it was 15.5%. The profit after tax for current financial year, 2024, is eighty-six point one crore, compared to financial year 2023, it was 79.7 crore. The tax margin for the current financial year, 2024, is INR 10.7 crore, where the financial year 2023, it was 18.5%. Thank you very much. We can now start the Q&A session. 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 telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Nitya Shah from KamayaKya Wealth Management. Please go ahead. Hi, sir. I wanted to understand whether the BioSecure Act, which has been passed in the U.S. recently, what impact, do you think that would create for Gufic? Is there any big advantage you're seeing out of that? Yeah, hi. I'm sorry, actually, there was a little bit of a disturbance. Can you repeat that question again, please? Yeah. I was saying that the BioSecure Act that has been passed in the U.S.- Yeah. How do you see the impact coming on Indian players such as yourself? Do you see this as a good benefit going ahead? So very frankly, it's very preliminary and very early to comment on that, because in the past also, we had come up with some other act, in terms of the generic market, which, eventually then got changed once the election changed. So I'm assuming since the act has been made, there will be, what do you call, a proper execution. For us, keeping in mind the India market, specifically keeping in mind some specific products, is that, if we are able to do a good regulatory profiling of our factory, and there are certain technologies where, and there are certain, I would say, USPs by which, as a U.S. FDA factor and having Prime Bio also a part of that, there can be some advantages. But again, I would like to say, you know, because it's very preliminary and to comment on that, and right now, I'm still not the expert because what my team told me, let's... That's what I would try to give you, the same feedback. After going through your presentation, is it a fair assumption to say that in quarter two, we will start seeing the commercialization of the Indore CapEx? So that was a good observation what came out. As you see, last year, we are trying to go for more and more hospital penetration and direct supply rather than primary supply to stockists. Right now, because of the different experts whom we have called, in Indore to get the audit done and the feedback done, I think there's a delay of one, 1.5, two months happening in terms of the actual commercial production starting. We visited DCAT also in the month of March, and there were some, clients whom we already are engaging for the U.S. markets, and it's gone much. I think the, the discussions have really taken a good turn, and their QA team has come, and they also have given their inputs, which can be not changed right now. So implementing those changes, keeping the confidence, and as Avik said, we also had an ex-U.S. FDA inspector who has retired, and, you know, she does consultancy. She also had come and give us a good insight about certain processes which are being implemented and executed right now in the media fill. And something we did before the media fill, and right now something will be done side by side in utilities also. So I hope, the line three, line four, which will be starting the revenue, should be captured from approximately June. ... that'll be for the last week or maybe by July first week. Yes, as you said, the lyophilization full-fledged revenue should be start capturing from July and August first week. So you can say maybe two months full of Q2 will be somewhere where you will see the revenue going up. Because we have a big order book, and we are right now struggling with execution. So I hope, I mean, I'm not sure, now I'm sure now, so not hope anymore. We are sure that from July onwards, we can see the revenues being captured in the, in our profit and loss. Yeah. Now that you've crossed INR 800 crore of top line in FY 2024, are you confident on, you know, reaching close to INR 1,000 crore revenue mark by FY 2025 end? I'm confident for sure, and I'm sure we'll be doing it, especially what Indore comes in, other things coming in the order book what is looking for. But more or less, I would like to make a point that is very clear. You know, gradually, year by year, we are right now de-risking ourselves from contract manufacturing, getting into more front-end where the profitability is. And even now, even with Sparsh and Criticare, we are even in infertility, we are trying to, you know, get more and more involved in direct supply to the doctors, to the patients, where we can maneuver the pricing, also maneuver the, what you call, the quantity. Keeping this in mind, primary is not something I'm focused on, but yes, I think INR 950 crore-INR 1,000 crore is something, if I look even with all these parameters, and we hope we can cross that also. The more we get into tertiary and secondary billing rather than primary billing, the numbers might take a hit, but not that much also. But at least we'll get more, you know, we can control our business much more, where we have our control of which hospital, which nursing home, and all of them are buying it, rather than depending on certain distributors. So yes, I feel we are close to 1,000. And last question from my end, was, regarding, you know, I've noticed the working capital structure has been a little more stretched. You had explained due to, you know, onboarding more hospitals and penetration into the hospital. So in this year, are you seeing the working capital to ease out a little bit, like better payable terms from the hospitals and so forth? Yeah. So that was a, I think, very good question. So in the first year, to get the confidence, get the penetration done, you know, and also to, you know, something is there. All the hospitals, these doctors and these people are giving us so much benefit, can Gufic give us same? So in the initial run, we have definitely stretched it, not only in terms of hospitals, nursing homes, but even with certain infertility centers also, where we know what are the cycles going on. But we feel, going forward, by September, at least, around 40%, 45%, 50% of the amount will be back in circulation because we have some other parameters of discounting which we have started now. And I think by the end of the year, we feel that the data should come back to the normal level. So that is the one big thing, which we also realized, because, you know, we thought that going and reaching the end customer is good, but sometimes we expect that, you know, getting the money and they expect more discounts, so we are taking care of them from now on. Got it, sir. Wish you all the best. Thank you. Thank you. Thank you. Thank you. The next question is from the line of Aditya from MSA Capital Partners. Please go ahead. Hello, am I audible? Yes, sir. Please go ahead. Hi. Hi, Pranav sir. Hi, Avik. Thank you for the opportunity. Quickly, wanted to understand what would be the revenue split across our SBUs, that is, domestic branded business, international business, CDMO and API, and how has that grown over the last year? So, very frankly, because of the demand of Sparsh and domestic, that 55% of our domestic revenue has grown to 58%. Then of course, API, I mean, then the next biggest thing would of course be exports, which has gone. I would say no, the next biggest thing would be contract manufacturing, which has fallen from 25 to around 21% or 22%. We have seen, or actually little less, it's actually 19% if I consider Q4 also. And then, the API and it's the export business has increased. The problem with export business is because of the capacity cons, capacity constraints. There are some U.K. tenders which we have just won in Germany, which we hope to fulfill in Q2 this year instead of Q1 this year. That will of course give that percentage change. And then, of course, API business is around 4%-5%. So export would be around 20%. The next thing will be, I mean, export would be around anything between 18%-20%. Contract manufacturing will go from 19%, what is there last year would fall down to 17% or 16% this year. And then, domestic business will be anything around 58% ±, with the Sparsh division also getting further helped by the Indore plant. The API, like I said, between 3%-5%, because the base of the other division will increase much more than the API. So we'll see API fall from 5% to 3% or maybe 6% to 4%, something like that. Understood. The gross margins have improved quite well on an annual basis. Is this sustainable or there was some one-time material benefit that we got? So that's the problem, I'll tell you, you know. So with gross margins are in spite of our validation that is happening at Indore and Navsari. So that's the reason, if you remember, last three quarters, I've been telling you I'm trying to go off the primary billing and going more to directly to hospitals, to nursing homes and to doctors, where which is having an impact on the debtors, but at the same time, the margins are definitely improving because I'm getting much more transparency of business. So someone who is buying 100 units and then discounting themselves as a primary thing, I can ensure now I know every, each and everywhere, where my 100 units are being sold at a better price. So this is one thing which has helped us for gross margins, in spite of the prices also. If you see, the prices from China have eased off only in the last three months. Otherwise, the prices last year were quite high and they went up. In spite of that, in spite of the validation batches, which are also part of the consumption, the gross margins we're able to maintain is because of this direct penetration we are trying to increase. So now, that's why I answered the first question also now: Is it worth keeping this pricing benefit as against, the debtors level? So that is why we have come up with some new solution also from March onwards, where we are trying to give some more discounting, which is still less. We still our margins will be kept lower, but we'll give some discounts to the hospital and incentivize them to pay us little bit more ahead. That will ease out hopefully by September and next March. ...Understood. The previous participant also asked, the data that you highlighted also why, but if I would just to get a color across the SBUs, other than Sparsh, which would be the division that impacted the increase the most? So, critical care, because there also we are directly now supplying to hospitals and keeping that market data where we really come to know what hospital is buying, how much, and at what pricing. So the stocking patterns have reduced, so the primary has gone down because distributors have stopped stocking it. So whatever orders from the hospital, that only is taken care of since last September. So last February, we started Sparsh, that is 2023. From September, we started critical care, where all the inventory they keep is based on the hospital actual supply. And third division, that is infertility, we have started only three products, that is Puregraf, then Gonal-f, and of course, Graviparin. So these are the three products which are part of infertility, which consume around 25%-30% of our revenue of infertility. These are all only tertiary business which happened, and all this is an addition to the Stunnox business. The Stunnox and Zarbot, since launch of the divisions, have been directly doctor supplied, so there's no primary billing which happens. So all these five, I would say, different product line of Sparsh, critical care, then, infertility, 25% revenue, full revenue of Stunnox, and full revenue of Zarbot. All of them are directly tertiary business only, which we penetrate on, where directly we give it to the hospital, the nursing home, or what you call the doctors. And we ensure that penetration, and we have real-time data of who is buying how much and what number of units, and this is the total which is affected. So even in critical care, we have superseded the super stockists, the entire supply system. We are not dealing with super stockists anymore. We still have stockists, but stockists have market data. So the stockists still are very important point, where without stockists we cannot work, because they have a good penetration and collection. Right. You know, because as a company, we can't outsource or enter or NovaCare to go and collect from a small Class B towns. But now the stockists are pure stockists working at a net margin, that is, 8%-10%. So any order is validated by the team, and that is only then supplied for, by which we get real-time data that which hospital, which nursing home was buying for. So it's not that, you know, we need to, you know, do the primary billing to supply to other people also and make little bit more margins wherever possible. So that is little bit difficult now overall. Understood. So just last couple of questions. Yeah. So, we have got an in-licensing approval from a innovator who manufactures pain management molecules. So if you can just- Yeah, the once a week pain management product. Okay. Yeah. So you can highlight that a bit. How large is the market? Who is the innovator, if that is possible? It's a company based in Taiwan, and they have already got approval in Southeast Asian markets like Taiwan, Singapore, Malaysia, I think, and two more countries, Japan, they are in trials. In the U.S., they are looking for a partner for phase III. In India, we have taken the exclusive rights for India, where we have also it's actually a two-sided relationship. Firstly, that they gave us the exclusive marketing rights for this pain management. So what is in pain management? Any ICU-based patient or any doctor and any orthopedic, any ortho, I would say, pain relief or even gynecology, wherever the acute pain is there, when you want immediate pain relief, where you either have to take a, I would say, you know, like a morphine or something, or if you have to take a diclofenac or anything of that matter, depending on the nature of the pain, of course. These products can work well in conjunction and also maybe in some cases, in isolation also. You don't need to pop in pills every day. You don't need to take injections IV every day. You take an injection on the first day, then you need to take the injection on the fifth day or the seventh day, depending on the seriousness of the pain. So the entire compliance of the patient and the doctor just go. So you go to an ortho, he say, "I have severe pain," he just gives you an injection on day one, and then for day five, you are still okay. So you'll be also happy that, you know, certain people who take, NSAIDs or NSAIDs, N-S-A-I-D-S, who have, you know, acidity issue, or some people have kidney issues, or some people where the first part metabolism issue, or some people have other side effects. This is completely avoided. So this is a good product which we are quite gung-ho on. And, like I said, tomorrow, if we reach a particular milestone of sales in India, then we get a localization option also, where we can be a contract manufacturer for them, for other countries also along with India. So it's a good relationship. It's almost one year we worked on the deal, finally it got signed, and I think it's a good addition to our ortho range as well as ICU setup range also. And even in gyneco range, where cesareans and other sort of pain or even hysterectomy or others are involved. So it fits our front end very well. Oh, congratulations! And how, and how large would this market be? So pain management is a large, large market, but- Right. Inside pain management, what- Yeah, so of course, the day-to-day pain, which is there, which can be managed by oral, of course, we will not get into that, because we're going to price it also differently. So that is where our discussion is happening with the innovator, and as how do we price it? So based on the pricing, which clarity should come, because, you know, first we are doing a clinical trial here in India also. I mean, we have asked for a waiver, but if they ask us to do a clinical trial, we'll do a clinical trial in the Indian subset also. If that happens, we'll come to know also, like, on the Indian patient pool, how is the, product happening. Based on that, we have some pricing options. So if we decide pricing A, then the market addressable is so and so. If we decide pricing B, then the market addressable is, is something else. So I think let's wait for a quarter or two, and then we'll give you a little bit more insight. But anyway, we're looking at launching this product way around in 2025, Q1 or Q2. So that is where the timelines is, assuming that we have to do a phase III. If we don't have to do a phase III, then we're looking at Q3, Q4 this year. Let's hope for the best. Understood. So this will be manufactured from our Indore plant? No, no, this, right now, will be manufactured in Taiwan and will be imported here. Moment we reach a particular milestone in sales in India, then it'll be manufactured by the Indore factory, yes, down the line. Understood. And sir, for our Indore plant, what would be the timeline where we would trigger... So that we would not directly go for U.S. FDA, we'll first go for an ANVISA or- Yeah. EU GMP- Also, we'll be targeting it parallelly. So we are looking at 3-5 molecules which are immediately starting in every line. Line one, line two, line three, line four. There are total four lines. Mm-hmm. Out of that 40-45 products, which Avik spoke about, there'll be around four to five products which will be, have, which have been planned on every line. We'll be triggering the inspection from the first two products only on all these lines. So we have, Europe, U.S., then of course, Brazil and, I think even Russia and others also planned. But because most of the products which we are there in the first five launches in every line are something products which eventually we want to take in all these countries. So how you have Navsari, which is approved by all, I would say countries except U.S. and Japan, now Indore opens up the market also for U.S. and Japan. So, we will be filing, as and when, with all these clients right now. In Japan, we don't have a client yet, and as well as I think in some one, two other countries, we don't have a client yet. So other countries we can take it up as terms of trigger. So, when are we planning to trigger? So the batches will be taken by July, like I said, and August, and then on three months stability, that is around October, November, we'll file for the, what you call, we can give the doors here. But the moment the WHO GMP comes and also we have... So we are looking at 2025, where most of the audits will be triggered subject to the availability of the auditor. So anything between Q1 to Q4, 2025, you will have a series of audits happening in India and in Europe. Understood. Understood. And then we will, we will start registering the products. Yes. in those markets, where they receive the health certifications. Yeah. Perfect. So that's all from my side. Thank you so much. Thank you. Thank you. Ladies and gentlemen, you may press star and one to ask a question. The next question is from the line of Bhavya Sonawala from Samaasa Capital. Please go ahead. Hello, am I audible? Yes, sir. Please go ahead. Yeah, thank you for the opportunity. Just had two questions. First, on what we spoke about in terms of going from dealers to directly kind of handling hospitals. I just wanted to know how useful the data, you spoke about we do get a lot of data, right? I wanted to know how useful this data is, and in the short term, will we face some challenges because it's a pretty big shift of the channels, you know? We are facing sometimes, you know, considerable challenges because, you know, you're going against the tide, you know, where you have people with other interests coming in and, you know, I would say trying to disrupt that, especially I would say that other channel partners. But yes, more than the data, it's the transparency of business and the margin expansion is what we are looking for. So today also, it's, I mean, I, more and more, you know, competition is coming in critical care, where the price erosion is happening. And that way, actually, that price, whatever you try to give as a company, doesn't always reach the right hospital. We got a teaser and some good success in Sparsh, and that's made us confident to do it immediately by September in critical care and along with that, in infertility also. So definitely the data is useful in terms of whether my... You know, so we have these different PIN code-wise mapping done. PIN code-wise mapping also gives us indication of what particular molecule is happening in PIN code-wise, and what are the hospital things. So sometimes, I'll give you a small example. A primary care hospital is there, a secondary hospital and a tertiary. Tertiary is something like an Apollo or what you call, Max and Medanta. A primary care has the potential of buying advanced antibiotic, whereas we think that, no, it is only a piperacillin-tazobactam or a meropenem will be suffice there. But now we have seen when we go and actually meet there, I mean, first we realized with this data that even after six to seven years in critical care, we have only penetrated 800 hospitals. So that was one eye-opener once we got with the data karke. And now, just in that September onwards to, what you call, let's say April 2024, that critical care division itself has gone from 800 to 1,200+ hospitals. So that is something which is good. Sparsh anyway has its own journey going on side by side. Even in infertility, we always feel that, you know, there are only, you know, who is actually giving you business? There are only maybe three to four infertility centers per MR, which gives us the business. Where we know the potential in that particular town or city or wherever he is being represented is around 25, 30, 40, 50, depending on the population and the sheer market size. So today, if three people are able to give us a PCPM of INR 5 lakh-INR 6 lakh per month, why don't we actually, you know, go and penetrate and maybe go for other, what you call, open up the other IVF center also, which can be a target for the future. So such data is very invaluable. Of course, there's always pros and cons. You face challenges. You know, sometimes the stockist just buys and keeps it ready for 2 months. He pays you in 30 days, 35, 45 days, and it's okay. Sometimes when you directly deal, you know, you have to pay for the stockist spaces, but I think the gains are much more than the cons. So I feel, little bit with discounting. If we can take care of the cons of the debtors, then I think this is, we are on the right track and we should take it forward. Okay, that actually makes sense. But in terms of the kind of penetration we have right now, will we... What I'm trying to understand is, will we see kind of a slowdown? Because obviously this would take a lot of transition from actually going to dealers and putting out our own people to actually go and go into the hospital. So that's what in, that's a year or two. Or do you see any kind of slowdown in terms of this? No, actually, well, so again, so if my primary, let's say, from a 690, if I could do 900 with a primary sale, I must have done only 808. I always have a 10% hit coming in, because that is a 10% stocks which a dealer will always help me to do it or keep it or stock it, or if the dealer will give me that business which is in his control, he'll never expose that to me. That might be 10%-15%. But in terms of our growth and the margin expansion, that's a small price to pay when down the line we feel more and more transparency coming in the entire equation. With companies like Entero Healthcare, NovaCare coming in, they have brought the entire distribution, I would say, bandwidth in the country to be much more transparent and much more upfront. And, you know, so gone are the days where, you know, you have, I would say, you have this cat and mouse game, you know, when, you know, no one knows where they are selling, and you don't ask also. Don't ask, don't tell. That is something which is going out. I feel it's in the short term, yes, we will be paying that price of 10%-15%, or maybe 10%, I would say, not even 15%, but long term, it will help us out with this database for sure. Okay, understood. The second question, we've been doing about INR 200 crore a quarter now. So is it fair to assume that this is the kind of peak revenue from the Navsari facility until Indore comes online? Or is there some scope for this to increase in terms of product mix once Indore comes online? No. So rightly said, yeah, so Indore is more... I mean, Navsari's lyophilization and injection capacity is more or less full now. We cannot do much with it. And that is where you are seeing that revenue breaking thing. But, you know, things like penins and things like botulinum toxin and things like other things, and our herbal products will always give that traction, which will be growing and growing there. But you're right. If I want in terms of the capacity, in terms of injectable, which is a substantial chunk of our revenue, Indore will help us to unlock that. Indore is almost one and a half times in Navsari, so that is something where we feel that, you know, yes, definitely once Indore starts from July, August, in line three, line four, and line one, line two, then definitely we'll see more of the orders being pre-owned. So now we have orders since 90 days, 120 days for exports, which is little bit getting on, you know, we are on the, you know, burner right now. We are pushing Indore to start as soon as possible. At least we are able to take care of all these tenders and orders much more. There are some orders we have stopped taking now, at least for the next one to two months, which are, you know, sudden sporadic orders, immediate orders, which we could have encashed if Indore was there. So that would all start from July onwards. Okay, understood. And just a follow-up to the first question. You spoke about tertiary and primary care in terms of categorization of the hospitals. Can you... Is it possible to just give a rough kind of estimate on how we lie in terms of primary care, tertiary, where we supply the highest? Oh, yeah. Tertiary still becomes a bigger chunk for us, completely. So like Fortis, Max, Medanta, Apollo will be still where we'll be present always. And that is where our people always go there, because that's the catchment area. But sometimes we see in the primary markets and the secondary markets, there are much better margins, but there are, the quantities consumption are much low, and there's much more fragmented. And that is where we now need to get up on it, introduce much more. So we were always, I think, leading and doing a good job in the tertiary hospitals, which had, you know, good economies of scale, but the margins were quite getting eroded year-over-year. And this primary and secondary was something which is a good insight we are getting. So if you ask me right now, majorly we might be still 60% in all our business of critical care, 60%-70% would come from tertiary. Secondary would be another 20%-25%. 5% only would be right now, primary care market. Understood. Thank you so much for all the explanation. Thank you. Thank you. The next question is from the line of Ayush Mittal from Mittal Analytics. Please go ahead. Hi, am I audible? Yes, sir. Please go ahead. Yeah. One question I have is: How much would be the revenue for the whole year from Aesthederm division for us, and particularly from aesthetics? So the botulinum toxin contributes around INR 25 crore. That is both aesthetics as well as neuro. And right now, exports have not yet started. So this is just the current thing. And the other products in Aesthederm would be approximately maybe, INR 5 crore-INR 6 crore. So, other thing, the observation I have on our numbers for a very long time is, like, if you see for last, 10, 12 quarters, the company is stuck in a range of revenues of about INR 170 crore-INR 180 odd crore, and now INR 200 odd crore in last two to three quarters. But when we see about many of our divisions, sub-segments, we see that we are the market leaders in areas which are fast growing. The natural growth is more than 15% or 20%. So why doesn't that translate into our numbers, overall? And, yeah. No, please go ahead. Please finish the question. No, no. Yeah, you answer this, maybe I'll have a follow-up. Yeah. So there are two, three things. In critical care or also in infertility, there is also an API price dependency which we have to stick to. So as I was saying, the price peaked post-COVID, and after COVID, after the peak, it actually went down from the last three to four months. So there are some molecules which start coming down in September, October, November 2023, and some started coming from May, June 2023 also. So that is where, let's say, I'll give you a typical example of an HCG, where the urinary HCG comes from China. China, at one time for Mega, was selling at almost $300, or $280-$300. That same, and we, we could sell the injection. If I tell you in terms of the injection, the injection selling price in India was around INR 220-INR 230 for a vial, even though MRP was around INR 490 or something. Now, the actual selling price of INR 230 has come down to around INR 140. So that is because, again, the API dependency, because the API has come down from $300-$80 or something. Same thing with meropenem, which had reached a peak of around INR 150,000 per kilo, that has fallen down to almost INR 50,000 rupees, so one-third the API price has happened. So in certain cases, when you see in infertility as well as in critical care products, and even now, you know, fungins, also others, as and when the efficiency and the prices have become more stable or we have gone into backward integration, there is a price erosion which happens either because of the price cycle of the product or because of this. So there's always... And these are the molecules. I'll just give you example of two or three molecules. These are the two top three molecules, which contribute to around 15%, 20%, 25% of the products. Like that, there are more examples. I just give you example of top 2, top 3 to 4 products only. So this has an impact on the top line, even though the volumes are remaining or the volumes are increasing also. So that is one, two impacts which come there. Second impact also, as I said, no more, more and less, in terms of top line. We have stopped, you know, primary billing, which was happening before, a little bit stopped since last year, not last year, last September 2023. So that is where also we always had two months or three months, no, I think not more than two months inventory lying at the, what do you call, stockist level and a month inventory at the CSA level. So that has now almost come down to 45 days, because actually it's primary versus secondary. I'm sorry, the primary is equal to the secondary or the tertiary directly. There's also some stocking also which we have reduced on, which we had with. We cannot just suddenly start supplying to the doctors and the inventory is lying at the distributors. There will be more of an issue for us in terms of associations and all that. So first, we had to liquidate the inventory at the stockist level and then directly go for supply, which helped us to also, you know, keep everything cool and calm and, you know, everyone taken care of in terms of statutory compliance. So that is where we feel these are the little bit two, three challenges which have, you know, impacted the top line. But if you see numbers and numbers volumes, they increase at a much higher percentage. But, like when we are in, when you say that you are in a, on the formulation side, brand side, the price change would not be so much, like, even if the API prices have fallen so much, do you have to decrease your price by 20%-30%? Absolutely. All this, in the segment what we are, the advantage and the disadvantage is that if the price increase, we get the pricing benefit immediately. If the price reduce, we have to give the discounting immediately. So this is where the, entire compliance is all because of the link to the, what do you call, the API pricing. And that is where, you know, we told you that we are backward integrated of certain fungins, which is helping us to take it forward. But yes, the, the sensitivity of the pricing, not only for us, but even let's say example, for the U.S. market or other markets, for enoxaparin or for heparin or even for that matter, some other, onco molecules are all, you know, API dependent. Okay. The other thing is, like, though we have not seen much growth happen, but on the balance sheet, this has been raised earlier also, but I still don't get a good understanding of this. That's why I'm repeating on it. But the inventory has more than doubled in last three years towards the better, while our business hasn't grown that much. Okay. So the first thing is you're in, if you see last- What I'm trying to say is that either the margin should have gone up, like, given the kind of business we are in, where we have a brand, where we have that dominance in terms of penetration leadership. So what usually we have, we see with other companies is that your margins increase when you have to do such kind of other things. Right. So I'll explain. So when you have to consider the inventory, you have to also consider Indore as a, what do you call, year of transition for us also. For us, in any injection plant, to start any plant, we have to do validation studies, media fill studies, other studies also where we, you know, like, we have to take three, three batches, each of the highest batch size and lowest batch size as required by the QA team, and keep the batch size for six months minimum, and then eventually sell that in the market. In terms of U.S., we don't have to do. In certain products, we have planned for U.S., then eventually either you have to wait for the U.S. business to happen, or if before that, if the U.S. business doesn't happen, then that has to be completely, I would say, consumed and goes away. So that's why the consumption is dependent on where any validation batches which we have taken, and we have been completely written off without any revenue, because that's where the validation happening. In certain cases where there's a validation batches, but we can still keep it and hope that once the approval and registration comes for WHO GMP or something, then we can sell it in the Indian market, or we can sell it in area markets, which is allowed by the European Authority or allowed by the Russian Authority and so on and so forth. So such things, because we have invested more than INR 300 crore in the Indore factory and we have four lines. In the entire year, the effort from October 2023, itself, itself when the actual qualification started, most of our stock is being used in terms of keeping the validation practices. So even when you come there, you will see huge piles up of vials, rubber bands and, what do you call, I mean, whatever, primary, secondary packing materials, plus along with that, some APIs lying there, which is also used for certain trials and error also. So that year in transition started from last year. Again, coming back to your first point, in terms of the things, if you see from a INR 440 crore revenue, we had gone to the peak revenue of INR 800, I think INR 790 or INR 800, when the COVID time happened, when everything was hand-to-mouth and the inventory was coming in and out. The moment that happened, then of course, the year of, you know, where the, you know, of course, COVID, where we went to a revenue of INR 690, where we had a lot of returns coming in from the market, which we had to salvage and take it off. Then from a INR 690, whatever crore, we have gone to INR 800 crore. Like I said, keeping in mind the transition that we are going away from the primary market to, what do you call, a much more secondary and tertiary market. So if you analyze the last three years, and then you see the next three years, which will be coming in, you will see all those things which you are hoping for and asking for- Mm. - should be visible in the next three years, once these become much more consolidated or much more, I would say, upfront. Okay, okay. So, last two questions. One, can you tell us what kind of utilizations do we aim for within, say, six months of our commercial operations rather, years? If you can give some perspective to it, one. And, second, also in terms of revenue, and second, we raised funds from Motilal Oswal, we did a raise almost INR 100,000. Yeah. What was the objective and how does that help us, given that we have good cash flow also, so why that decision was taken, and yeah? ... Yeah. So actually, can you repeat the second question? I understood the first question, can you repeat, utilization of what? Yeah, the Indore plant, like, on what, yeah, capacity or revenue, what kind of numbers are we expecting once we start the commercial operation? Some timeline and some perspective on that. Okay. So first, I'll answer that question. So Indore, hopefully starting by, like I say, June end for line three, line four, and July end for line one, line two. Let's take July and August for these two lines. We foresee in the first year, at least till March, gradually 5%, 10%, 15%, going to around 20%, I would say, capacity utilization, in assuming, of course, one shift, okay? This is, I'm assuming one shift. Because in line optimization, the shifts are all three. In line three, line four, which are liquid and oil, we're looking at, one shift as of now. Maximum, we can go for two shifts because of the CIP, I think. So this is what I see. Revenue-wise, I'll ask Roongta to reply, I'll not comment on that. Answering your second question about Motilal Oswal's investment of around INR 99.99 crore. The three things are there, which were very important. One was, of course, the validation batches which we needed to take, and we even had those years to make, which will help us to penetrate into the foreign market. So we did not actually wait for Indore to come. Certain validation have been taken care of in Navsari itself or in the R&D sort of a setup. And then we thought that we just do a tech transfer to Indore to save time. You know, otherwise, we would have to go for a complete analytics method validation, complete PDs once again and then take it forward. So those were the one of the reasons. Second reason also was keeping in mind the penetration coming in about, the, what do you call? Growing from primary to secondary, tertiary, we knew that the margin expansion was more crucial, and we would need some, you know, working capital required for the penetration, Sparsh, Critic are, and even for Aesthederm going forward. And the third thing is that we had a loan of around 40-odd crore of long-term, which we paid off completely, out of that. So that was how the three utilizations were taken care of. No, no, it was... That's how you utilize the cash. But to raise funds from an investor, usually the thought process is, why did we need to tap our investor? We could have managed this by internal cash flows also. No, but like I said, now, tomorrow, if getting the dossiers and so I have right now, you see, Gufic is a very, different company. Some companies are either domestic-centric or some companies are export-centric. Mm. It is very easy for us to just focus on one market and then wait for two to three years to enter the other market. Now, since Indore is coming in, we have invested more than INR 300 crore in the Indian Indore facility. Out of that also, if you see, if you see, I think 300 or 330, I think Roongta will be much better to say how much has been invested there. We have taken only a loan of INR 160 crore. So the remaining thing, of course, we have done with internal accruals or via, you know, our own thing. But the issue is that if I don't encash that capability or that facility with those years on time, with the regulations, I mean, the product line on time, the R&D, like, there are four products which Avik spoke about, which also require, you know, these special Dyno Mill, which requires a homogenizer, all that. If you don't encash on all that, then I'll be again paying forward. At the same time, coming back to the domestic market, right now is the time where we need to penetrate into more and more markets, where I have to be independent of, you know, the channel partners, where they can dictate my business. So today, if I am able to encash on the Indore's capability of capacity by having a front end which is sustainable and which is predictable, that is always makes sense much more. So these two factors of getting domestic and export, done at the same time, we thought that it is better that we take this, dilution and then we take an investor in, because this will help us to reach our objective much faster. And the Indore factory will be, I would say, in a much better, healthier position in terms of capacity utilization than would, than it would have been otherwise if we went in a straightforward internal cash, generation mechanism there. That is where we took this decision. Okay. Okay. Thank you. Wish you the best. Yes, thank you. Thank you. The next question is from the line of Bhavya Sonawala from Samaasa Capital Please go ahead. Yeah, thank you, sir, for the follow-up. Just one question. Previously, to the previous participant, you just said that the last three years have been kind of a transition from COVID to kind of getting the Indore facility up and running. You spoke about how the next three years will actually show the results. So just again, trying to understand, in the next three years, you've done a lot of innovative and a lot of new things in terms of getting Stunnox up and running, Sparsh, and doing a lot of interesting things. But in next three years, is it possible to just guide us in terms of some numbers? Do you think we'll be able to reach kind of INR 1,500 crore-INR 1,800 cror e revenue? Will we be able to double our revenue? Some kind of guidance, because we are doing a lot of things, and we're also seeing good results of that. So a guidance will kind of be more helpful to understand which, where the company is going in this direction. So very frankly, if you see whatever has to be done in terms of CapEx, what has to be done in terms of manpower expansion, what has to be done in terms of divisions, we are more and more sorted. There will be no more CapEx or there will be no more new divisions coming in, except like I said, you know, an add-on to existing division also, which is all part of the main thing. So now all those things are done, and this was a good opportunity because we are quite bullish on the Indian industry, pharmacy industry, that we will see the actual boom happening in the next five to seven years. And I don't expect to be, you know, waiting there. So again, numbers, I will not be able to give you anything. Of course, I'll request Roongta, sir, to maybe comment on that if he can do it after I finish my explanation. But, like I said, you know, when we were 300, we could reach that 800 number because we had the infrastructure and the manpower in place to actually take care of that. So it's not that we are going to get an opportunity of a COVID back again, but what we learned from that COVID phenomenon, that there is a huge amount of business subside or penetration which is available there, which we need to just get ready for in terms of infrastructure, divisions, product pipeline, all that, which we have done in the last three years in terms of investing whatever we earn in all these things. So yeah, Roongta, sir, you want to take it right now? I think revenue-wise, 10, 15... Yeah, please go ahead. Yeah. ... similarly, we already said in lot of investor calls that we are expecting the top line should be grow between 15%-20% year-over-year for at least next three to four years. That is our expectation, but numbers is very difficult for anybody to guess the number. It's depending upon lot, lot of things, approval is pending, and we feel that, yes, there will be a growth between 15%-20% over the year for the, for the next three to four years. Hmm. Okay, thank you, sir, and all the best. Thank you so much. Thank you. The next question is from the line of Vishal Manchanda from Systematix Shares & Stocks. Please go ahead. Thanks for the opportunity. On Indore, if you could share a number as to how much you would have spent this year on the media fill validation and other batches you would have produced. So basically to understand what's the normalized number of your normalized profit of your business? Yeah. So I think Roongta said, "Can you take this question now? Yeah, yeah, yeah. Yeah. There is the Indore facility commissioning in the month of March, then there is a lot of validation batch and trial was going on. Approximately, I can take, say, between INR 8 crore-INR 12 crore we have spent on, on this, all this trial. And current quarter also, we're going to spend better amount in the trial. And total CapEx for Indore plant till March 2024 will be around INR 290 crore. Another INR 15 crore-INR 20 crore CapEx is pending. That is going to happen in the month of April and May. So, and other than this, around INR 30 crore amount has been blocked under GST receivable account because of input credit we are not able to utilize for Indore. The total cash outflow is around INR 325 crore, it may going to increase by INR 15 crore-INR 20 crore. The total outflow after full erection and commissioning of the Indore plant will be around INR 340 crore. Got it. Thank you. And just one more. So basically, we have been introducing very unique and very differentiated products in India. Just want to understand, like, whether we are putting in adequate sales effort around these products to scale them up, or there could be kind of there is an option for you to kind of enhance your medical representative, your kind of MR count and basically make this larger in a faster timeframe? No, actually, no. I think we are quite okay with the manpower what we have. It's just that we are making like, let's say we had the asthma team, and then we carved out around seven people out of that asthma team division of around 40 people, which are like a special task force. Now, in Q4, we have launched Guficap, Supergraf, and there will be other exclusive products launch, which I think they're on June. What we are doing from the existing field force, where the productivity and the performance is not coming up to the mark, we are coming up with a new team of 40 max, which is from using the same field force, either experts from here and then maybe some good experts from the industry, from recruited in companies, and come up with a 25-30 field force for that. So increasing the manpower is not the right way, according to me. And we feel that it's more of a PCPM thing. Moment, every division of us has a particular PCPM we need to cater to. And if the PCPM, once that is reached, then we of course go for an expansion in that same territory or adjoining territory, which is not represented. So like I mentioned that, like, you know, even though we have a field force, some people are doing INR 5 lakh-INR 7 lakh, but they might be getting that business only from three to four infertility centers from that same town. Now, that same person, if he works out much better, he can get a business from around 10-15 more IVF centers. Might be the quantum might not be that high, but it is still possible for him to handle 20-25 IVF centers, by which his scale can be going to INR 15 lakh-INR 20 lakh also. So our focus would be to go a better monitoring of the people, see how many calls do they make, how many is the, you know... So we have since last four to five months also, because of this new data coming in, once we started getting data from Ferticare and for Criticare and for Sparsh, we actually could now find out what is the hospital-wise business, what is happening. And based on that, we can actually tell them, "You've been working in this hospital for a long time, so why is the business not coming?" Or, "If you're working in this hospital and you're getting this, or you have got this business of INR 2 lakh-INR 3 lakh, that means why don't you attach one more hospital which is next door, which our team have identified, which will help you for a better PCPM?" So I hope this answers your question. Well, it's more about penetration and increasing the PCPM rather than increasing the people. That's what I feel we're going forward is with this data. Got it. Got it. So just a follow-up, like, would you have a sense as, as to how much your competitor, in case of like Stunnox, your competitor would be— What kind of a sales force would they be using to push their product? What would be the, what would be their size of sales force? Would it be a similar size- We do have. or much larger? We do have. It's not much larger. It might be 20-25% more. Got it, sir. Thank you. Yeah. Thank you. As there are no further questions, I would now like to hand the conference over to Miss Ami Shah, the company secretary, for closing comments. Over to you, ma'am. Thank you very much. I appreciate all of you joining us today. If any of your questions remain unanswered, you can get back to the investor relations team, and we'll be happy to take those separately. With that, we'll conclude today's call. Thank you. Take care. Thank you. On behalf of Gufic Biosciences Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.