Ladies and gentlemen, good day and welcome to SeQuent Scientific Limited Q4 FY 2025 earnings conference call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Abhishek. Thank you, and over to you, sir. A very good morning to all of you, and thank you for joining us today for SeQuent Scientific's earnings conference call for the fourth quarter and full year ended FY 2025. Today we have with us Mr. Rajaram, MD and CEO of SeQuent Scientific, Dr. Haribabu, Whole-time Director and CEO of Viyash Life Sciences, Mr. Saurav, CFO, SeQuent Scientific, and Mr. Ramakant, CFO, Viyash Life Sciences, to share the highlights of the business and financials for the quarter. I hope you've gone through our results release and the quarterly investor presentation, which have been uploaded on our website, as well as the stock exchange website. The transcript for this call will be available in a week's time on the company's website. Please know that today's discussion may be forward-looking in nature and must be viewed in relation to the risks pertaining to our business. After the end of this call, in case you have any further questions, please feel free to reach out to the investor relations team. I now hand over this call to Rajaram to make his opening remarks. Thank you, Abhishek, good morning, everyone, and a very warm welcome to all the participants. Joining me on this call is Dr. Haribabu, Whole-time Director and CEO of Viyash Life Sciences, along with Saurav Bhala, the CFO of SeQuent, and Mr. Ramakant, the CFO of Viyash. You would have gone through the results and the investor presentation, which was released yesterday for the financials of quarter four and full year financial year 2024-2025. My colleagues on the call and I are delighted to share with you more details and answer your questions today. Coming to the performance of this quarter, I'm pleased to announce that we continued our strong performance and closed the last quarter of FY 2025 with revenues of INR 4,017 million, which is INR 401.7 crores, reflecting a double-digit growth of 11.2% over the same quarter last year. I'm also happy to share that this quarter's revenue has been the highest in the last few years and continues on the trend of sequential growth that we are seeing every quarter. This performance came in with a 38.7% growth in our pre-ESOP EBITDA, which grew to INR 56.9 crores or INR 569 million, which translates to a margin of 14.2%, which is broadly in line with the guidance that we have given for the exit margin for the year. The company sustained a strong momentum during the year as a result of various initiatives that it has undertaken over the last 18 months to strengthen the business fundamentals and prepare us for the next phase of growth. Coming to the performance for the full year, financial year 2024-2025, our revenues grew at a healthy 13% to reach INR 15,516 million, which is INR 1,551.6 crores. At an EBITDA pre-ESOP of INR 199 crores, that's a very healthy growth year-on-year. While Saurav will talk a bit more about the financials in more detail, let me cover some aspects of the business. Our formulations business, which is the largest part of the company, continues to trend very well. It sustained the high base of the last quarter, and on a year-on-year basis, it has grown in healthy double digits, nearly 20%, and that was driven by a strong performance across all geographies. In Europe, the growth in the year was led by new sales avenues, which were created, especially in vaccine partnerships, higher exports from Europe, as well as the expansion of the fast-growing Phyto Solutions segment. In emerging markets, the 26% growth was supported by a change in product mix towards better margin products, organization restructuring in Mexico, higher export volumes from Turkey, along with some very judicious price increases across the board. We believe that our position in these local markets, where we have teams over there, allow us to maintain a unique position in the key animal health markets of those countries and the regions which they are present in, and that remains a strategic priority for us in the long run as well. We've also initiated groundwork for the entry of the Phyto Solutions portfolio in the Latin American region. The formulations business in India is a top priority for us. It has continued to do well on the back of field expansion that we undertook during the year, and that has resulted in a 13% year-on-year sales growth, which we expect to accelerate in the coming year. To further our presence, we have identified the next set of levers which are required to build this business, and it includes a second phase of field expansion in the early part of FY 2026, as well as new product introduction. We believe this will go a long way in building a very strong foundation for deeper penetration in India, while also providing a platform for our brand-building efforts. On the API front, I'm quite pleased with the transformation in the business. The strength is visible in the improvement of margins and sequential recovery. We expect to see the acceleration from quarter one this year. Importantly, the fundamentals for growth are in place. We filed two DMFs during the year, and our sales from our top customers, the top 10 customers, grew vis-a-vis last year, and the contribution has increased from 51% to 54% during this year. We also received WHO pre-qualification for albendazole and many prestigious awards for safety and quality. The long-term relationship that we have with our global formulation companies helps us partner them in new product efforts, and we expect to see some of the new business materialize in FY 2026. With the forthcoming merger, we expect the benefits of R&D and manufacturing to flow in, thus enabling us to grow faster and build new segments such as companion animals. I would like to take this opportunity to thank the entire team of SeQuent and Alivira and all the stakeholders involved for their effort and the support that they have provided this year, which has resulted in a strong performance for the year, but more importantly, created the platform for future growth. I will now hand over to Saurav to share the financial details of SeQuent and then invite Dr. Hari to share the highlights of the Viyash performance. Over to you, Saurav. Thank you, Raja. Good morning, everyone. It's a pleasure to join today and share key highlights into the strong financial performance of SeQuent Scientific Limited for Q4 and for the entire financial year of FY 2024 and FY 2025. I will also provide an update on the progress of our strategic merger. Starting with the Q4 highlights for SeQuent Scientific Limited. In Q4 2025, we recorded a total revenue of INR 4,017 million, reflecting a strong growth of 11.2% year-over-year basis and a 2.8% growth on quarter-over-quarter basis. Our formulation business reported a revenue of INR 3,015 million, delivering a 22% year-over-year growth. The API business generated INR 869 million in revenue, delivering a 7% growth on quarter-over-quarter basis. Gross margin saw a notable improvement of 420 basis points on a year-over-year basis, increasing from 46.1% to 50.3% in quarter four. On a sequential basis, margins improved by 210 basis points, up from 48.2% to 50.3%. Our EBITDA pre-ESOP for the quarter was INR 569 million, reflecting a robust growth of 38.7% year-on-year basis and a 15.5% rise on a quarter-on-quarter basis. The EBITDA margin stood at 14.2%, up by 280 basis points year-on-year basis and 160 basis points on a quarter-on-quarter basis. The profit after tax for the quarter stood at INR 103 million, improving substantially from INR 13 million in Q4 of last financial year, which is a very remarkable growth of about 712%. Coming to financial highlights for the entire financial year 2024-2025. For the full year, the total revenue delivered is INR 15,514 million, marking a 13.3% year-on-year growth. The formulation business contributed INR 11,858 million, registering a 19% increase on year-on-year basis. The API business reported a revenue of INR 3,378 million, reflecting a growth of 4% on a year-on-year basis. Gross margins for the year improved by 320 basis points from 44.5% in the last financial years to 47.7% in the current financial year, driven by the various strategic initiatives, including our sales mix optimization, geographical expansion, deeper market penetration, and selective pricing actions across geographies. EBITDA pre-ESOP delivered is INR 1,993 million for the financial year FY 2024-2025, delivering impressive 18.6% growth on a year-on-year basis. The EBITDA margin expanded by 500 basis points, increasing from 7.8% in financial year FY 2024 to 12.9% in financial year FY 2025. This reflects our consistent focus on driving profitable growth. We achieved a significant turnaround in PAT, our profit after tax, improving from a loss of last year to a profit of INR 322 million, a remarkable growth of 208.9%. Coming to the update on the merger process. I'm pleased to share we have made meaningful progress on the strategic merger of Viyash Life Sciences Limited and its subsidiaries, along with one of our subsidiaries, SeQuent Research Limited, into SeQuent Scientific Limited. The milestone achieved so far are as follows. We got the board approval for the merger on 26th September 2024. We got the Competition Commission of India approval on 21st January 2025. The stock exchange approvals are currently under progress and is at an advanced level. We expect the approval soon. Upon receiving the exchange approval, the scheme will be circulated to NCLT or National Company Law Tribunal for the final clearance. In summary, our performance for Q4 and the full financial year 2024-2025 reflects the strength of our strategic plan and execution excellence focused on driving the profitable growth as a central theme. We are more confident than ever for the stronger growth continuity in the coming quarters based on the robust foundation created. We remain committed to creating enduring value for all our stakeholders. With this, now I hand over the call to Dr. Hari, who will take you through the performing highlights of Viyash Group. Thank you. Thank you, Saurav and Rajaram. Congratulations to the SeQuent team, entire team for great performance. Good morning all, guys. Let me take you through Viyash performance now. Viyash recorded a strong performance in Q4 with acceleration in revenue growth and margin expansion year-on-year. As you know, our core strengths remain R&D, manufacturing, and intellectual property. For Q4 FY 2025, revenue grew by 15% to the corresponding year last quarter of INR 370 crores and adjusted EBITDA grew by 93% over last year same quarter to INR 65.3 crores. Viyash had strong EBITDA margins of 17.6%, continuously improving the EBITDA. For full financial year, consolidated revenue of INR 1,458 crores represents growth of 11.2% when compared to FY 2024 revenue of INR 1,311 crores. Adjusted EBITDA for the full year, FY 2025, INR 254.6 crores represents a growth of 52.4% compared to FY 2024 EBITDA. EBITDA improved from 12.7% in FY 2024 to 17.5% for FY 2025. During the year financial year FY 2025, the business has generated healthy free cash flow of around INR 201 crores. This shows actually the company in the balance sheet. Also we repaid borrowings about INR 145 crores during FY 2025. With this repayment, our current debt actually remains at around INR 74 crores, and net EBITDA ratio is around 0.3x. We want to reiterate that a lot of costs below EBITDA, particularly exceptional items and amortization of acquisition intangibles, are largely non-cash or non-recurring and steady-state PAT margins, excluding exceptional items this year, should be above 10%. Also this reflected in our free cash generation of INR 200 crores in FY 2025. Business growth is supported by investments in critical areas and a strong operating base, which we'll cover now. Our business has strong momentum across portfolio selection, validations, filing, and launches. New product launches and filings. We filed four new products in last quarter, and also we filed three products in this quarter. Strong portfolio selection. Of course, Viyash strength is R&D and portfolio. We have 25 products in our portfolio, which includes a lot of N-1 and also CGT. We completed four validations this quarter, and we got six regulatory approvals from various countries. Operating base. We look at our business across three segments, and these are covered on page 18. For API plus plus, as you know, we have a well-diverse portfolio of 70 plus products commercially, which includes high value, and most of the products are a little bit differentiated and medium volume products. This reflects our top 10 products has grown at 23% CAGR over last three years, and an average of very strong material margin of about 58%. As you know, we have a global customer base across 150 + countries, and we have an extremely backward-integrated manufacturing setup with cost leadership and have cleared multiple regulatory audits over the last decades. Even this week, there's a Europe audit is going on at one of the site. It's going pretty well. We are capable to handle multiple inspections, whether in U.S.A. or Europe, any country, okay, and strong and capable to manage everything. As the business has grown, we have leveraged our innovator and large generic customers to build our development business. This is a key area for our future growth. We have added almost 10 + development contracts over the last two years, which includes a couple of products like life cycle management for innovators, as well as a few contracts with complex generic companies. We have a few small formulation business, as you know, in the U.S. with local manufacturing. We are moving that business to complex portfolio and integrating with our API to get cost leadership. Moving to combined performance and margin benefits. For Q4 FY 2025, combined revenue of the two entities grew by 13% year-on-year, and EBITDA grew by 63% year-on-year. The combined business had an adjusted EBITDA of INR 120 crores in Q4, with 15.8% margins. For FY 2025, combined revenue of the two entities, 12%, and EBITDA grew by 66% year-on-year. The combined business had an adjusted EBITDA of INR 450 crores with 15.1% margins. The combined net debt EBITDA ratio is now at 1x, compared to 1.2x in previous quarter. As updated last quarter, and also now Saurav updated the merger status. We have started to plan for integration of the two companies and realizing synergies. We had received CCI approval, of course, as explained by Saurav. Most important is we have made substantial progress in R&D and manufacturing and will represent a granular action plan and estimated synergy value to the board. We are going to present to the board sometime in first half of FY 2026. We had said last quarter that R&D will be quick win for both companies and integration is going very well. We expect the merger process to close, as explained by Saurav, in 12-15 months, mostly by end of this year. Thank you. I think with this, we can now open for questions. Can we take the Q&A, please? Thank you. We will now begin the question-and-answer session. Anyone who wishes to ask a question, may press star one on touchtone telephone. If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, you will wait a moment while the question queue assembles. The first question comes from the line of Amey Chalke with JM Financial, please go ahead. Yeah. Thank you for taking my question and congrats to the management on good numbers this quarter. First question I have, basically the previous call, we have been mentioning that we would get to a double-digit kind of a growth and mid-teens margins. This quarter we have already achieved that. Going ahead in FY 2026, what will be the outlook for the growth and margins, sir? Thank you, Amey. Yes, we had guided that. That's on SeQuent alone, right? We had said that we would come closer to a mid-teen margin and double-digit growth as we exited this year, and I'm happy that we have reached there. Right now, we will not be able to tell you a guidance for next year. I think we have already laid out the plan that by FY 2027, we are looking for SeQuent to come closer to high teens kind of a margin. We would, of course, Viyash with its performance would be closer to the twenties range as far as the margins are concerned. Therefore, I think over the next 24 months, we should be seeing the company reach there. In terms of top-line growth, of course, a healthy double digit which should be anywhere in the mid-teens is what we are expecting to do over the next two years. Dr. Hari, would you add to this? Yes. Over to you. Just to add to what Rajaram mentioned, I can tell you guys, whatever we achieved this quarter is pretty sustainable. Okay. Of course, whatever your guidance FY 2027, what Rajaram mentioned, we are pretty confident to do that. We may do little better than that. We are pretty confident in achieving sustainable growth. You would have seen in our investor presentation also that the pillars which are there for growth. We have already, as Dr. Hari has just mentioned, the synergy plan as well as the benefits of the merger will begin to flow in during this next one to two-year period. Therefore, obviously, the businesses in terms of the results which we have right now should be not only sustainable, but they're also likely to do better. Just to clarify, this 18% or high teens kind of a margin, what you said would be on standalone, right? Before the merge, as in not including the merger synergy, right? I think it's a bit early for us to comment. Very clearly we are on a combined basis, the company which we had guided earlier also should be looking closer to about, I think we are today right now about INR 3,000+ crores in terms of top line. We are heading closer to an INR 4,000 crore kind of figure, if not better, in terms of top line in the next 2 to 2.5 years. We would be looking therefore at a margin profile, which should be of closer to 20% on a combined basis, at least. Thank you. I think that now we'll keep updating you as the team progresses, but that's a reasonable thing to sort of move forward with. Sure. The second question I have, is there any plan for us to enter into CDMO business? What are the opportunities considering the combined company in the CDMO side? Dr. Hari, I think would be best on that. Yeah, absolutely. This year, that's one of the key focus, actually, expanding CDMO business as well as complex products development. As you say, in Viyash already we do CDMO business. We have business with innovators. We do business with innovators by six clients. Also, we entered another five, six development agreements with complex generics because the CDMO are two, three things, right? One is innovator business. Life cycle management, already we are there in the commercial, and we are working with the new products. The second thing is most important, we see where there are opportunity for CDMO for complex generics. There are many specialty companies in Europe, U.S. They only focus on marketing and portfolio. They always look for partners for R&D development as well as manufacturing. We see lot of interest. Already we signed three contracts in last six months, and it's working pretty well. This year we are going to focus a lot on expanding in the CDMO, you can see substantial change in the next year. I think that's a great upside for the next two, three years for this company because we are fully established to meet any CDMO customer expectations with respect to EHS or quality or R&D. All we have their capabilities. We are strengthening teams this year, and you can see lot of growth next year from. That's one of the key focus area for us. Sure. Thanks so much and I will join back in. Thank you. Thank you. Thank you. A reminder to all the participants that you may press star one to ask a question. Next question comes from the line of Shiwani with Monarch Networth. Please go ahead. Oh, hi. Am I audible? Yes, Shiwani. Yes. Sir, very congratulations for the excellent set of numbers. My first question is on tax rate. For SeQuent in Q4 FY 2025, the tax rate was at the higher range of 35%-36%. Any specific reason for that? Yeah, hi, Shiwani. Tax rate for SeQuent is a combination of various sum of parts across the geographies. There are impacts which happens for the full year, which gets accounted in Q4. There are slight adjustments which happen for Q4. On an overall year, if you see, it remains to be on a normal range. I think that is going to be the new normal going ahead also. Just to add on that, what is the tax rate that we should build in for this year and the next year? About 30%. 25%-30%, in that range. Sure. 25%-30%, right? Okay. My next question is, I also wanted to get some clarity on the new launches in the companion animal health segment that we are looking at. I think that currently we have less than 10% companion animal health products. Just wanted to understand that how to look for this segment and what can be the contribution in the overall portfolio. Thank you. Right now, the businesses which are more geared towards companion animals for us are in Europe, as well as in Latin America. Over there, we have a range which is coming out now in the area of anesthetics, which gets commercialized during this year. That is the area which we are building very fast for companion animals. Apart from that, there are nutritionals in Latin America, which are getting launched. We are also looking at India seriously in the area of companion animals in developing a product portfolio. I think we should see launches coming every quarter, certainly in Europe, and more towards end of the year in Brazil and in India. Our target would be that we should double the contribution of companion animals in the next three years in our portfolio. Yeah. Thank you so much. Can I continue? Yes, please. My next question is for Viyash. Q1 Viyash revenue, we saw a decline of 3%, and also there was slight drop in the margin also. Were there any specific underlying reasons for the same? The sequential quarter drop is mainly because there's some inventory build-up in finished product in U.S., Shiwani. We have U.S. formulation facility. The customers, they build a little more inventory in previous quarters. That's the phasing issue. That's how the drop actually 3% is basically from formulation. There is no gross margin drop on those things. Sure. Thank you. I'll join back in the queue for subSeQuent questions. Thank you. Next question comes from the line of Jagadees Sharma, an individual investor. Please go ahead. Hi there. Am I audible? Yes, please. Hi, good morning. Congratulations for a great set of numbers, sir. Could you please explain a bit about the growth you are seeing in Europe, and what are the products we sell in Europe, and how is the outlook for Europe in the coming quarters or year? Yes. I'll talk about the formulation space. Europe business has a large setup, which is in Spain, which is both for manufacturing and marketing in Spain, as well as manufacturing and marketing for countries in Europe. We manufacture them in Spain. We have four sort of broad product categories over there. We have the antimicrobials, we have the anesthetics, we then have the painkillers, finally, we have the dermatology and the nutritional products. Our growth, which we are seeing in Europe, is on account of two reasons. One is that we have a range which is for gut health, which is called Phyto Solutions, that's the range which is expanding fast because there is more and more preference in the use of natural additives for feed animals. That's one area which we are growing. The second is in the area of anesthetics, which are used largely for surgery and hospital procedures for companion animals. That's the piece which is growing for us. We also are a distribution business for some companies. We have recently tied up, because we have a very strong front end in countries in Europe, because that's an important capability to have, where we have a feet on street over there in some countries, in Belgium, Netherlands, in Spain, where people are able to contact doctors and veterinarian clinics. We've also become a channel and a partner for vaccines for food production animals. That's a business which started last year for us, and we think that's the other piece which will be growing. I think based on the infrastructure where we have, we should be able to add more and more products for the infrastructure. That's the primary driver of growth for us. Apart from the other thing, of course, in margins, because this is a better product mix than the traditional low-end antibiotics, the margins are improving in Europe because the quality of the product mix is changing. That's really the two sort of drivers for growth, which are there in Europe. We are, of course, not present in a few very large markets like France or U.K., and the distribution opportunity for our existing products in those markets would be the next obvious headroom for us to be able to go. Okay. My second question is that, how is our business in Turkey doing, and are we being impacted by the recent political issues? As far as the business in Turkey is concerned, it had had challenges which were there earlier in foreign exchange and economy, and those have largely been addressed because of some of the actions that we took in terms of improving our exports from there, in terms of price increases, et cetera. Of course, the country situation also improved quite significantly in terms of the economic condition relating inflation drop, et cetera. That operating business over there, it has come back and is doing well. In terms of the current sort of conversations which are there around Turkey, we have to remember that the business in Turkey which we have is a local operation. It's a local entity. It is in Turkey for Turkey, and therefore, it is meant really for sales and distribution within Turkey as well as some of the neighboring markets. There is no real dependence either on India or India's dependence on Turkey as far as the business is concerned, because it is managed completely locally. We don't see any impact on that at all from the current sort of news which is going around on that. It's purely a local in Turkey for Turkey business. My last question is, could you give us any guidance for Viyash standalone sales or margins for FY 2026? Yeah. Dr. Hari. Yeah. I think as Rajaram mentioned, we don't give guidance, but I can tell you, Viyash, we have pretty sustainable growth. Whatever the margins we see today, it will continue and definitely next one, two years, FY 2026, FY 2027. We also mentioned earlier that it's going to cross 20% EBITDA margins. It's a pretty consistent, sustainable growth we'll have. Okay. All the best for the next financial year. Thank you. Thank you. Next question comes from the line of Thomas Priju with AlfAccurate. Please go ahead. Thank you for giving me the opportunity. I just wanted to clarify, we are talking of high margins for SeQuent. We are talking of 20%-plus margins for Viyash and close to 20% margins at the combined level by FY 2027 at pre-ESOP level or post-ESOP level? All the conversation that we have, all the comparisons are right now at a pre-ESOP level. Everything we do on a pre-ESOP level. Understood. How much should we budget for FY 2026 for ESOP for both SeQuent and Viyash, and if possible, even for FY 2027? We can give you a bit on what we know right now for SeQuent, because the other pieces I think we would like to share it only after we complete the merger process. For SeQuent, you should expect around INR 30, 32 crores to be the ESOP cost for next financial year. It's of course, on a declining basis. That's what it will be. They are trending downward. Understood. On the rest, I think once the formalities are completed, that is when we would. I think as Dr. Hari also indicated, fundamentally, this is a business that is moving very clearly on a sustainable basis to closer to 18%-20% kind of a business with the highest Q on the positive side of 20 for Viyash and maybe one point below or two points below for SeQuent. Understood. You are looking at more than a 300 basis points expansion in terms of SeQuent and maybe 200 bps in case of Viyash. Is it possible to provide some color on what is the underlying factors which will lead to this margin expansion? I think on SeQuent, we've been giving it. First, I'll give a chance to Dr. Hari to sort of explain on the Viyash side and the API part of it, and then we'll add a top-up on the SeQuent part. Yeah. Dr. Hari, on the margin expansion piece for you. As you see in our investor presentation, we have two initiatives, especially, you know we do every year 10, 15 products development and file. Most of the products are either slightly differentiated or complex products. Year on year, when we are developing 10, 12 products, and we are able to launch at least six to eight products. All these products are new products and margins are reasonably good. Other thing, margin expansion for Viyash, basically, our current capacity utilization is around 60%, 65%. When the revenue is growing, our OpEx percentage is continuously coming down. That is where you can see from last two, three years. It is continuously coming down, our OpEx, it straight away goes to bottom line margin. There are two, three things. One is our OpEx reduction. The second thing is all our new products, whatever we developed and filed, expected approval. The third thing is, as I mentioned, we are expanding business a lot in CDMO and other few complex areas. I think this will generate good business in FY 2027, 2028, and margin will be much better than what we anticipate. These are the three areas I can say that. Thank you, Dr. Hari. That pretty much would be the typical model anyway. I think even for the formulations business, it's largely going to be driven by an improvement in the mix of what we sell, because I think that's a big driver for growth in formulations. As you improve the quality of the product mix with higher margins, which are a combination of the kind of therapies you are in, as well as more and more as you move towards companion animals, their margins are substantially better. Second, of course, is a set of new products, introductions and innovations in these markets, which we are already sort of seeing that momentum come in in FY 2025. These are going to be the key two drivers for growth for the formulations business. Does the slightly hostile environment with Turkey currently at the diplomatic level affect our business in any way in that country? No. I think I just answered on that question. The business in Turkey is in Turkey for Turkey. It's a local company, which had been acquired by us. It's robust business within Turkey and for the neighboring markets. I think there is no commercial exchange in terms of exports, imports, et cetera, of materiality between Turkey and India. I mean, our Turkish business and India, therefore, we don't see any impact at all coming from this. It is completely an international operation for that part of the world. Understood. On the Viyash side, in terms of CDMO, are we trying to develop for CDMO work with innovators on the ingredient side or on the final API side? Is it possible to provide some color on what is the sort of CDMO work we are trying to develop? Today, what we do in CDMO are two parts. One is with innovators, we do APIs and also do key starting materials. Whatever we signed, a few things, a few starting materials. Most of these are for their life cycle management. Once the patent comes out, they try to move their manufacturing from expensive countries to India. That's where we are able to get a few contracts. Few products, two, three APIs, we are their global supplier for that. Second thing is we are able to get some contracts for advanced intermediates from innovators. That will continue. The second part where we have initiated last year, it's working pretty well. CDMO is a complex generic or some specialty company. There are quite a number of companies in especially Europe. They identify the product, but they look for CRO or CDMO players. We are able to attract that business, and the advantage of that business is even unlike with innovator business. We are able to get actually revenue for even R&D development as well as validation. Most important actually, we're able to negotiate with some profit share during their commercial sales. That's a pretty well model. We are able to attract two, three contracts already, and this is going to continue. Also large generic companies, they're struggling with their cost. That's where they're looking for CDMO players, not for matured products, contract manufacturing type. They're looking for some CDMO players for the complex APIs. That's where we are able to partner few generic companies actually. Few things, partner with co-investment, taking risks together and taking profits also together. Few things purely CDMO play, we partner with them with R&D and manufacturing and contract with manufacturers. Basically, these three areas for next one, two years. Innovators, we are going to do more and more life cycle management business, both API intermediates, and most important is complex API specialty companies. That's the large focus next. This year is the building phase for next level. Whatever is phase I, phase II, maybe we'll start from end of 2026. That's where we are trying to build a little more infrastructure with that. Hope I answered your question. Thank you. Mr. Priju, please rejoin the queue for more questions. Next question comes from the line of Sajal Kapoor with Antifragile Thinking. Please go ahead. Yeah. Hi, thanks for taking my question. Happy to see the gross margin recover and cross the 50% mark. However, our EBITDA conversion into cash flows for SeQuent, it stays too low. I mean, not just for FY 2025, but this has been very low, around 45% odd EBITDA to OCF, operating cash flow, for almost four years now. Mainly due to cash getting stuck in things like receivables and higher than normal inventory. The question really is, how can we fix this in future? Saurav? Thanks for the question. Your observation is right, it has been low, but if you see quarter-on-quarter, we have been focusing on improving very specifically on that area. In fact, last financial year, there was a significant operating cash flow which got generated after, I think, two years, which you mentioned. With a clear focus on optimizing our working capital across the geographies and various other initiatives we are taking, this remains to be area where we will keep on improving quarter-on-quarter. Next year is going to be substantially better than the last year. That's helpful. That's reassuring. Thank you so much. That's the only question I had. Thank you. Thank you. Next question comes from the line of Bhavesh Gandhi with Yes Securities. Please go ahead. Yeah. Yeah, Bhavesh. Good morning. Good morning. Yeah. Hi. Good morning. Thank you for the opportunity. One question on the SeQuent API business. Any color or update there in terms of what we see the outlook over next two years in terms of growth drivers and any push and pull that we are seeing in this business? That will be helpful because it is still a meaningful business for us. Thank you. Yes, I'll just first say yes, it is a important business for us. We have been looking firstly on the revenue side to start sort of coming and crossing the INR 100 crore a quarter kind of a mark. I think we expect to get into that zone next year. There is a lot of work which is going on with the help of the team with Dr. Hari and the Viyash team working both on the R&D and on the improvement for the pace at which we're introducing new products. We certainly expect that this business will begin to accelerate towards the second half of next year. In terms of the direction of the business, I think there are two clear areas. One is that future growth will come from acceleration of new products. We have some in the pipeline which are due to be commercialized. The second is, of course, to make sure that our operating efficiencies are much better. That is something which is an inevitable outcome of the merger. I think we will get benefits coming in there. Of course, these will take a couple of quarters before you begin to sort of get that in. Having said that, there's a big shift in the interest in the company from the innovators and from large companies after we've announced the merger. We have more companies now coming to us to have conversations around new projects, and I think that is going to be where we will get growth coming from because with the infrastructure of Viyash, we should be able to give much more confidence around some of the new projects. On the existing business, we are seeing an upside, which is coming right now on the albendazole business, which we have, which is an important product for us because there is a requirement with the WHO part of the demand, which is increasing. We are one of the few companies which has the pre-qualified approval for WHO, as well as the kind of grade that we supply which meets the quality requirements. I think there's an inherent momentum which is coming on our existing business, which will take us through for next year. At the same time, I think the second half of the year, you'll begin to see a more acceleration coming with our announcements on new product development, et cetera. That's really the direction which we will go. Dr. Hari, would you add anything on this? I think you covered very well. Yeah. Okay. I think it's also important just to add that on the sheer margin profile, this business has substantially improved in the last 18 months. I think we are on a healthier gross margin profile on the business, and we therefore see that that gives us the leverage to sort of build on this business faster going ahead. Yeah. Okay. Thank you. No problem. Thank you. Thank you. Next question comes from the line of Bharat Sheth with Quest Investment Advisors Private Limited. Please go ahead. Hi. Good morning, sir. Am I audible? Yes, Bharat. You're audible. How are you? Dr. Rajaram and Haribabu, thanks for your asking. Hearty congratulations on excellent performance and turnaround. More about that is that setting up a new platform for accelerated growth in both top line as well as EBITDA side. If I have to think now from, say, you are up to FY 2027 kind of a guidance, but if I have to beyond that, so say three to five years perspective, how should we think about that? Yeah. We are working now. Maybe next six, nine months, we are going to get that three to five years plan, and if possible, we'll try to give guidance. Okay. Sir, second thing, if you can give some color up to say FY 2021 you have given EBITDA side, below the EBITDA say for any non-cash item or non-recurring or depreciation and interest as well as on the balance sheet side, that will be more helpful, sir. Yeah. Definitely, we can give detail later, but if you see our balance sheets are going to strengthen day by day. Coming to Viyash balance sheet, even today, it's very strong balance sheet. When I mentioned actually we were able to pay debt INR 145 crore this year. This year, FY 2026, Viyash is going to be a debt-free company, and we'll have some free cash. Viyash, another thing is actually also that EBITDA below items, as we mentioned. Couple of things actually. One is the regulatory situation that's not abnormal. The second thing is depreciation related to the goodwill. That's going away in FY 2027. Actually, you can see almost INR 108 crore in this year. Okay. That's going away in FY 2027. SeQuent balance sheet also, if you see actually it's improved a lot this year, even that debt-EBITDA ratio has come down to 1.9. Once we complete merger, day one itself, actually it's going to be more or less debt-free or very little debt. All our interest costs are going to go down. Big thing, interest costs, you can see Viyash this year around INR 20 crores to INR 30 crores and SeQuent is little higher. All these things will go away. We have a leverage to do lot of new things. That's what we are going to think from next year. Correct. Yeah. Okay. Okay, sir. Wish you all the best, and we'll see you once we are ready with our three, two year plan. Sure. To remain associated with our company for a longer period. Yes, Bharat. Thank you. Thank you very much. Good time get started. Thank you. Next question comes from the line of Harish with Monarch Networth Capital. Please go ahead. Hello? Yeah. Hello. Yeah. Yeah. Yeah. My question was on the line, can we narrow the margin expansion down to a particular product sale when you talk about albendazole-based or certain other API-based products? Is it possible to narrow it down? No, because I'm saying these are one day I think it's an ongoing business, so we can't really give you a split between one. I mean, there is clearly margin improvement comes from a variety of reasons, right? I mean, one, it comes from, like if you look like Dr. Hari said, in the API business, it will come from the new R&D pipeline, which is over there, the new CDMO arrangements, which will be there. There's enough surplus capacity and therefore there will be an OpEx leverage which will come from there. In the case of formulations, there are two clear routes, three clear routes. One is we already have close to 1,000 FDFs or fixed dose formulation filings everywhere. We have the ability to have geo expansion as in take the same products to different markets. Second is new products. The third is change the composition of the product mix so that a larger part of higher margin products are part of that. These are the levers. The real thing is about have we built the strength to execute this? I think all of these things have come in place. Last year is an evidence that if companies, we are able to execute it. I think you should really look at it as the way we look at it, which is that these are the three big levers for us to drive it. Yeah. Oh, yeah. Okay, sir. Understood. Thank you. I had one more question. You talked about the vaccine opportunity that we have in Europe. Can you please expand on that? We have the vaccine opportunity. Some of it is opportunistic and some of it becomes consistent once you launch the first vaccine, right? We have a field strength. We have physically sales people who today are doing distribution for our products in Belgium, Netherlands, Spain, a small team which is there in Italy. These are teams which are doing traditionally selling our own products. There are vaccine companies which need a front end to be able to l aunch and distribute vaccines. Beyond just the three or four large multinationals, the other vaccine developers need an option to do that. We have tie-ups where we work with the local agriculture or the government authority as and when there is a disease outbreak, and we are able to source vaccines which are appropriate for that particular disease. Recently, in Belgium, there was an outbreak of something called a Bluetongue disease, which is for sheep. We have a large presence over there. The government required vaccine, and we were able to distribute that. Based on that, we have now got tie-ups for additional vaccines with the same company, and we are looking at opportunities to be able to do that. We are not in the manufacturing of vaccines, but we are one of the important front-end distributors as well as marketers of vaccines in Europe. Understood, sir. I had one more question regarding the Zoetis distribution that we had stopped. Any update there in the India business? No. We have not stopped. We continue to distribute for Zoetis, the cattle product, and we are the sole distributors in India for that. Not just distributors, we actually have taken over that entire front-end part of the business. There was an important product there, which was pretty large. I think it was almost INR 12 crore-INR 14 crore of sales, which got discontinued by Zoetis, and we are expecting that to get back in the coming financial year. That was discontinued by Zoetis because of supply problems they had at their manufacturing site. Therefore, it was not available. Now we are working to relaunch that product in India, and that will, of course, be incremental when it comes, but we are waiting for them to confirm it. Otherwise, the rest of the business of Zoetis continues and is growing for us. Understood, sir. Thank you. Thank you for the opportunity. Yes. Okay. Can we take one more question? Yeah. It's 9:57. One last question. Next question comes from the line of Kiran Dhanwada with Table Tree Capital. Please go ahead. Okay. Thank you so much for the opportunity. I have two questions, one on Viyash and one on the combined entity. The question on Viyash essentially is, sir, I mean, we have grown year-on-year about 11% in revenue, and I'm just focusing on revenue because given your pedigree, we are sure the efficiencies will be squeezed, right? On the revenue, do we have a confidence of growing by 20% on the revenue base that we currently have, which is around INR 1,500 crore over the next two years as in year-on-year? The reason why I'm asking this question is, sir, not for guidance per se, because top ten products of Viyash, we are close to 45%-50% market share globally. I don't know if you have the ramp to grow at 20% year-on-year in Viyash. That's my first question on Viyash, sir. Okay. If you see our presentation also, as we mentioned, our top 10 products, we've grown almost 23% last three years, CAGR. That shows our strength on the existing products. Why 11% last two years? We acquired these companies three years back, and not many new products we got when we acquired. All the new product development or the new arrangements with new clients are happening last one, two years. Also you can see lot of new products developed and filed. The cyle time to develop file is generally three to five years kind of thing. That whatever we developed last two, three years, it started coming commercialization while maintaining our existing product growth, strong growth. With the new product additions, definitely we'll grow much better than what we have today. You can see lot of new products every year. Last year, I think we were in top 10. We were in fifth place of filing total number of DMFs. Last 11 months, we filed 15 to 20 audits, including five, six FDA audits. That shows our strength of new products, why FDA is coming actually. That's one of the reason we are filing more products. The new product, whatever we filed, it's going to grow next two, three years. That's a big thing while maintaining our existing products growth. That's where we are confident, sir, to grow much better than what we are today on the top line. Of course, bottom line, it will continue because as I mentioned, our operational leverage, whatever our capacity utilization, 60%-65%. Continuously adding some capacity. This year also, we are adding some capacity for few products which are coming for launch. That's where we can see growth. Got it. Sir, the CDMO leg of FY 2027, would it take us to a 20% revenue growth, sir? Is that a fair assumption? 20% in CDMO, yes. I think if I put it today, whatever we do, innovators and few generic companies, today it's working out at 5%-6% of our revenue. It's going to grow substantially. How much it's going to contribute in 20% growth, we have to work. That's one of the area, of course. Got it. One last question on the combined entity, sir. We have in FY 2025, in the presentation, we have exceptional items of about INR 102 crore. I understand all of this is non-cash, but just trying to understand how we see through FY 2027. Exceptional item, we've seen 102 INR crore. We are seeing amortization of acquisition intangible, INR 100 crore. This is combined of INR 200 crore. Are all of this going away from FY 2027? FY 2026, do we still expect some expenses to come here and FY 2027, both of these items will be zero? Is that a fair assumption? This amortization acquisition related to Viyash INR 100 crore, right? That's going to go away in FY 2027. I think it will go completely in FY 2027. It will remain in FY 2026 because it may come down, but it's going away completely in FY 2027. The remaining INR 102 crore. Sorry? Yes, sir. Yes, sir. Exceptional item, INR 102 crore. 102 crores. I'm just looking at Saurav, can you help me? Where is this actual INR 102 crores? Line 22, sir. INR 100 crores is the amortization combined. The balance, doctor, is for the provision. Yeah. Let me check. This INR 102 crores. Yeah. This INR 102 crores majority are related to merger things. One is, we have some accelerated share warrants, and also there were actually some merger related expenses and a few things actually related to actually whatever the contractual obligation for this merger. All this INR 102 crores also will go away maximum. In FY 2027. FY 2026, it will repeat, but FY 2027 it will go away. No, FY 2026, it will go away. Majority. These are actually like, this is purely one time. Amortization related will go in 2027. It will remain 2026. This exceptional item, INR 102 crores maximum, it will go in FY 2026. Got it. Perfect. Thank you so much. Thank you. That's it. I think. That was the last question, Thank youu. Thank you. Ladies and gentlemen, due to time constraints, we have reached the end of question and answer session. I would now like to hand the conference over to the management for closing comments. Thank you very much for attending this call. It's been a very exciting and successful year for the company as well as how we are moving into the next financial year with the merger, which is on the card. We look forward to giving you an update next quarter. Look forward to your continued support in asking these questions as well as participating on these calls. Thank you very much. Thank you. Thank you. Thank you. Thank you. Thank you, everyone. Thank you very much.