Ladies and gentlemen, good day and welcome to Vimta Labs Limited Q4 FY 2026 earnings call hosted by Systematix Institutional Equities. 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 0 on a touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Vishal Manchanda from Systematix Institutional Equities. Thank you and over to you, sir. Thank you, Nitesh. Good evening, everyone. On behalf of Systematix Institutional Equities, I welcome you to the Q4 FY 2026 earnings call of Vimta Labs. We thank the Vimta management for giving us an opportunity to host the call. We have with us the senior management of the company, represented by Ms. Harita Vasireddi, Managing Director, Mr. Satya Sreenivas Neerukonda, Executive Director, Mr. Siva Rama Krishna, Chief Financial Officer, and Ms. Sujani Vasireddi, Company Secretary. I now hand over the call to the company management for opening remarks. Thank you, Vishal. Good afternoon and a warm welcome everyone to our Q4 and FY 2026 earnings call of Vimta Labs Limited. Please note that the investor presentation and the financial results are available on the company website and the stock exchanges. Anything said on this call which reflects our outlook for the future or which could be construed as a forward-looking statement must be reviewed in conjunction with the risks that the company faces. The conference call is being recorded, and the transcript, along with the audio of the same, will be made available on the website of the company as well as on the stock exchanges. Please also note that the audio of the conference call is a copyright material of Vimta Labs Limited and cannot be copied, rebroadcasted, or attributed in the press or media without specific and written consent of the company. From the management, we have with us Ms. Harita Vasireddi, Managing Director, Mr. Satya Sreenivas Neerukonda, Executive Director, myself, Siva Rama Krishna Kambhampati, CFO, and Ms. Sujani Vasireddi, Company Secretary. I request our Managing Director, Ms. Harita Vasireddi, to provide you with the updates for the quarter and year ended 31st March 2026. Thank you, and over to you, ma'am. Thank you, Siva. Good evening, everyone. Thank you for joining us on this call today. FY 2026 has been a year of strong execution, resilience and strategic progress for Vimta Labs. As we reflect on the year, I'm pleased to say that we have continued to build on our core strengths while laying the foundation for the next phase of growth. Throughout FY 2026, Vimta has delivered consistent growth across its core service lines, supported by robust demand, disciplined execution and unwavering focus on quality. Pharmaceutical research and testing services remained our largest contributor, driven by good demand from both domestic and international customers. Food testing also demonstrated good momentum, while our electronics and electrical testing and environmental testing continued to scale in line with expectations. The broader environment continues to be favorable, driven by tightening quality norms, increasing regulatory scrutiny, innovation in pharmaceuticals and allied industries, and an expanding wellness ecosystem as such in the life sciences. These trends reinforce the relevance of our services and strengthen our confidence in the long-term outlook of the industry. One of Vimta's defining strengths is its commitment to quality and compliance. During the year, we successfully underwent multiple regulatory and customer audits, reinforcing the trust that global customers place in our systems, science, and people. These outcomes are a testament to the strength of our processes and the dedication of our teams. FY 2026 also marked a strategic milestone with our entry into biologics contract research and development services. The first year, which is this year, FY 2027, will be about execution, learning, and building credibility. Our focus is on delivering well for customers, earning their trust, and establishing Vimta as a reliable partner in this complex and evolving space. We believe the long-term potential is significant, we will approach this opportunity with characteristic discipline and patience. Vimta continues to maintain very healthy EBITDA margins, clocking about 35.8% in FY 2026, which we believe are among the best in the industry, even by global standards. While there may be natural fluctuations due to capacity ramp-ups, maintenance costs, people investments, and of course now the geopolitical issues, our focus remains on sustaining margins in a stable and competitive range over the medium term. Our progress in FY 2026 would not have been possible without the dedication and expertise of our people. While talent availability and attrition remain industry-wide challenges, we have successfully retained critical scientific and leadership talent, which remains central to sustaining quality, innovation and growth. As we look ahead, we remain confident. The opportunities across pharmaceuticals, food testing, electronics are real and growing. At the same time, we remain mindful of the global uncertainties, cost pressures, and competitive intensity. I would like to thank our teams, our customers, our partners, and all our shareholders for their continued trust and support. We remain committed to building long-term value through quality, consistency, and thoughtful growth. Thank you for being with us, and we look forward to continuing this journey together. Thank you, Harita Vasireddi. Good evening, everyone, again. Thank you for joining our Q4 and FY 2026 earnings call. I'll begin with an overview of our financial performance for the quarter and the year ended 31st March 2026. After that, we'll open the floor for any questions. Before we move into the financials, I'd like to highlight that the following, the divestment of our diagnostic and pathological services business in 2024. The figures for the previous period have been regrouped to ensure a like-to-like comparison with the current quarters. I will start with the financial highlights for the quarter. Total income for Q4 FY 2026 stood at INR 1,120 million, as compared to INR 961 million in Q4 FY 2025, up by almost 16.6% year-on-year, with a quarter-on-quarter increase of 11.5% when compared to Q4 FY 2025. The staggering growth was on account of our Food and Pharma division performing exceptionally well. EBITDA stood at INR 421 million in Q4 FY 2026, as compared to INR 347 million in Q4 FY 2025, up by almost 21.5% year-on-year. EBITDA margins for the quarter stood at 37.6%. Profit after tax in Q4 FY 2026 stood at INR 211 million as compared to INR 183 million in FY 2025, a growth of 15.2% year-on-year. Tax margins for the quarter stood at 18.9%. Basic EPS was at INR 4.7. Coming to yearly performance, total income for FY 2026 was at INR 4,163 million as compared to INR 3,482 million in FY 2025, up by 19.5% year-on-year. EBITDA for FY 2026 was INR 1,489 million as compared to INR 1,262 million in FY 2025, a growth of 18% year-on-year. EBITDA margin for the year is at 35.8%. Tax was at INR 775 million as compared to INR 668 million in FY 2025, increased by 16.1% year-on-year. Tax margin was at 18.6%. Basic EPS for the full year was at INR 17.4 per share. On the balance sheet side, we continue to have a net debt-free balance sheet with the cash and cash equivalents, including bank balances close to INR 650 million. With that, we can now open the floor for any question and answers. Thank you. Thank you very. We will noe begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on the touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use headset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We have first question from the line of Shreya Chatterjee from Ageless Capital. Please go ahead. Hello, sir. Thank you for taking my question, and congratulations on the results. My question would be that on your core verticals, would it be possible to give out the margin profile of each of the verticals and, like, going into the future, what would be the highest driver of the, like which vertical will grow the highest? If you could also give some update on your biologic vertical. Thank you. We don't differentiate the margins between our service lines. It's all treated as one service, so that information is not available. Going forward, you know, 90% of our revenues are driven by research and testing services for pharmaceuticals and food. This will continue. Both these service lines will continue to drive the growth of the organization. What question? On the biologics. Biologics. Yeah. Vertical. Yeah. We have put in place the processes, systems, equipment, people, to start working on contract research services, for biologics and peptides development. The machinery and the people, infrastructure, systems, everything is ready. When do you see these biologics to be a significant contributor to your revenue profile? Maybe not in its maiden year, too soon to comment on that. This year, what we hope to do is build traction in the market, onboard at least a few good clients, and deliver well. If I may ask, like, if it's possible to disclose how much of your, like, service profile or the contract profiles are FTE versus FFS for these four verticals? FTEs are only in the pharma service lines. Food and other businesses don't really have FTEs. Even on the pharma side, it's limited to analytical services as of now. It's not a major percentage. FFS would be the major percentage? Yes. Yes. Okay. Thank you. Reminder to all the participants that you may ask question by pressing star and one. Reminder to all the participants that you may press star and one to ask a question. The next question from the line of Yogesh Patil, individual investor. Please go ahead. Thank you very much for giving me opportunity. I just want to know what are the growth drivers which you see which is panning out the next one or two years? How does the business visibility going forward, like, in terms of maybe I'm not asking for, like, very bigger hypothetical, but in let's take it on quarter-on-quarter basis or month-on-month basis, like, how do you see that your long-term strategy is aligned with the revenues? Do you think the in current environment, it does have any kind of impact on current environment in terms of revenue booking or maybe deferment of client due to this U.S. trade or maybe supply chain issues arises due to Iran-U.S. war? Is there any impact of any global environment? Point number 1. Second, growth drivers in near term, how do you see the visibility in near term in terms of when you talk to your clients or maybe new prospective clients? Yeah, that's it from my side. The growth drivers for our industry, which we call contract research and testing, have more or less been same during the last decade. The only thing is outsourcing, whether it is for testing or research, whether it is pharmaceuticals, nutraceuticals, medical devices, or even for that matter, electronics or food, the outsourcing is growing. All these industries, on their own globally are growing at the rates of anywhere between 7% to even 11%, 12%. That itself provides an opportunity for all the players within the industry. Further to that, we have been dominantly playing with just a few markets. Our business development efforts are to go out overseas and gain more market share. Other than that, there's nothing that is significantly or drastically shifting in terms of growth drivers within these industries. Coming to business visibility, what we see for our food, pharma and electronics, and electronics testing, is that it's good visibility. These are going to be industries that will flourish in the future as well because some of them are essential. We see that more and more R&D spending is happening. The pipelines, especially for pharmaceutical, are shifting more towards large molecules. The innovation aspect is, I think on the upward trend, because the shift is from small molecules to large molecules. We also see a lot of smaller companies coming into the space of R&D, wherein even the large companies are collaborating with the smaller companies to strengthen their R&D pipelines. All in all, I think for pharma, food and electronics, good visibility. Coming to electronics, I think India's Atmanirbhar initiative and the focus on, you know, indigenizing a lot of defense tools and, you know, vehicles, whatever, is high. That calls for a lot of testing and Hyderabad is a hub for defense OEM. I think we are in a good space for now. Even putting aside defense, overall the electronic industry, what we hear, what we see also happening on the ground level is that there is a lot more activity in terms of investments that is happening. The manufacturers are who were also predominantly playing only in the domestic market, look now towards overseas markets to, you know, sell their products. All this is a healthy environment for a testing lab as a third party to, you know, verify safety, compliance and quality of the products. Coming to what our long-term strategies are, you know, they are perfectly, I think, aligned to how these industries are growing and the macro trends within the industry. Impact of war is there on us. The cost of some input materials, consumables, has gone up slightly. There is a slightly longer lead time for us in the supply chains. There is some impact directly on us as a result of this war. What will the future impact be is a wait and watch. We have to see how things pan out for everybody. Coming to last year, yes, I think the pharmaceutical industry was under strain because of the tariffs imposed by U.S. I think these have now been reversed. Whatever small lull that we had observed last year, we are hoping that will quickly be reversed, at least on the tariff side of things. At least from environment point of view, at least global environment or only industry prospects outlook, FY 2027 would be better than 2026, do you think, based on your client interaction or experience? Because more and more defense, electronics and plus your pharmaceutical launches, I think, I don't know how, which segment is going to benefit us. Based on your interaction with clients, because, see, all these are the very, very high growth areas in terms of clients interest and visibility even from government point of view. You are in the right spot, sweet spot, sorry, in terms of launching any products, CDMO and electronics and plus food is again a growing industry. I'm just try to understand, is there any in terms of client deferment of new product or is there any competition or do you see in terms of structural growth, let's say maybe FY 2027 to FY 2030, based on your client interaction, it means first is your client and second is sector and third is competition in terms of margins, how do you see going forward here? In a flourishing industry, in a growing industry, competition is always going to be there, and competition only intensifies because it's a very good environment. Coming to, you know, in near term, you're talking 2027 to 2030. If we talk, subtracting the situation, geopolitical situation, and also, you know, putting aside the sudden surprise tariffs that these days countries are imposing on each other. If you remove those factors, I think, you know, things should be good, better than what we have seen now. Things should only become better. Given the uncertainties, no, I can only comment when those things happen because it's anybody's guess. I completely agree. Your company is very difficult to track because in other sectors we can track export data or maybe certain IP and growth and all. In our kind of business, very difficult to get any basically growth drivers or maybe because all these businesses are in B2B and all is not in public domain actually. Nobody can track it. In terms of that manner, if you get some, you know, some visibility, let's say, can our company grow, let's say, get 20%-25% kind of CAGR over the next three to four years and maintaining the profit. Is that, like, that is possible or it is a very optimistic scenario? No, it's a stretch number but definitely doable. No, that's what we target each year. Okay. Okay. In terms of, let's say, expertise, like any clients, we are dealing. That client is coming to us or you also, it means he is launching new product. What I'm trying to understand is client is price sensitive or not? For some services which are very routine, low technology, low science, you know, those kind of services, price competition will always be there. There are some specialty services where the scientific input is very critical. There I think, Vimta has an edge. Okay. It's a mix basically, especially on the pharma side. Food tends to be more and more leveled ground for everybody. Companies that move fast whenever there's a regulation change, there is some advantage that can be taken out of that and that Vimta has been quite good at that so far. Okay. It means, from here, we're maintaining gross margin and, the incremental profit could be driven by only revenue growth. Right? Yeah. Margins, I think we are already doing well at EBITDA level, I would say. Yeah. Yeah, yeah. You can expect a correction of 1%, 2%, you know, depending on how things are, you know, panning out right now. Because if the input cost goes up, you know, there could be some impact for us there. Also manpower is something that continuously keeps on increasing, but we try to offset with the top line growth. We can expect some correction, but more or less I think it will be maintained. Okay. It will be manageable, or maybe it can be nullified due to revenue growth also. Yes. Yes. Okay. Thank you very much. Thank you. All the best. Thank you. Thank you. Reminder to all the participants that you may press star and one to ask a question. We have next question from the line of Mr. Vishal Manchanda from Systematix Institutional Equities. Sir, please go ahead. Hi, good evening, everyone. In one of your slides on the presentation that you've published, it says the pharma analytical testing industry is about $9.7 billion. Could you kind of give us a sense, like, considering this industry size, we are pretty very small, but we, despite being small, are meaningfully large in the Indian context. Just wanted to understand, why is that so? Despite the industry being large, India, the Indian market seems to be much smaller. Where are the gaps? Like, where does testing not happening enough in India? What could be that reason? I wouldn't say that testing is not happening in India because regulators such as U.S. FDA, EMA level the ground for everybody. India remains, you know, on the generic side, one of the largest players in these markets. Having said that, the R&D side of things, I think, is on a much lower scale in India compared to these developed markets. Maybe that's one of the main reasons. For my understanding, now these are just The numbers that I know is by that by 2030, you know, the Indian analytical testing market will be around approximately $300 million. It's really, really small compared to the global market. The main reason why we will not be able to tap into all that big size global market is because this tends to be something that is outsourced to local players. Because it's not worth, you know, shipping a sample overseas for simple analysis or a short-term analysis. Only where, you know, the project is of higher value would the customer also benefit in going to a country like India, which gives the advantage of both time, price, you know. I think these are the factors. In that, if NCE R&D picks up in India, that would be a trigger for the industry to become larger. When I say NCE. On the analytical side? Yeah. Could be. Yeah. When I say NCE, I mean new chemical entity R&D. Yes. Yes. Yeah. Possible. More R&D definitely is more work on all sides of testing and research, right? Not only for analytical, but also for preclinical, clinical research, everywhere. Your existing pharma analytic revenue, would large part of that be driven by ANDA filings in the U.S., generic filings in the U.S.? Is something else beyond the ANDA filings that you support? Analytical testing, I think by and large, remains on the ANDA side. I would ask Sreenivas to supplement if there is anything else here. Yeah. Mostly on the ANDA side and on further product release. Product batch release you said? Sorry? You said, product release. Other general product release, which is already, what do you call, approved in the market. If they are filing ANDAs, then to support their ANDA filings. Includes both approved products, ANDA, new products, 505(b)(2)s, NDAs. There could be some part of NDA analysis which is also done. Majority is towards the generic 505(b)(2) NDA and ANDA. Okay. One on the biosimilar business, biologics business that you started, would you only do contract research and manufacturing there? Or would you also do some off-the-shelf products which you can offload to some companies willing to do biosimilars in the U.S.? Like you'd kind of do the initial development on biosimilar and keep it ready and maybe someone wants to kind of leverage that. Is that also a strategy? To start with, it is mostly contract research. That's what we are going to start. We are going to develop products for our sponsors, our clients. Maybe at a later stage, but initially that's the plan. Okay. Have you signed clients yet on the biosimilars side? We have good inquiries. We will be closing them soon. We have a good traction from Europe, from India, a couple of them from U.S. as well. We're just finalizing the product and the modality. Great. Thank you. I'll come back in with you. Thank you very much. Sure. Thank you. The next question is from the line of Rohan Shah from RS Investment. Please go ahead. Hello. Thanks for the opportunity, ma'am. I want to understand what has led to the growth this quarter. I think we have achieved the highest ever revenue. Do you think we'll be able to keep up with this momentum, maybe INR 120 crore-INR 130 crore every quarter in the revenues? Yes, that's the intent to keep moving at this momentum. The prime drivers for Q4's good revenues are preclinical and also food has done well. Food testing, because Q4 tends to be, you know, a good quarter for food testing. These were the main reasons why we could push. We could have done better, because in some areas we did not see the kind of growth that we were expecting. Definitely. Now the intent and effort will be towards maintaining this momentum. Okay, ma'am. That's helpful. Ma'am, one more question. On the environmental testing front, how is the performance? I understand we are only providing post project monitoring. Just wanted to get some color on that. It's a very tiny part of our work that we do at Vimta. We have moved away from EIA, which is environmental impact assessment, and now sticking only to PPM, which is post-project monitoring. In this transition where we were moving away from EIA, getting into PPM, what we could do is just keep the revenues there. Next year, this year, we will try to push up the revenue. As such, no, this is not a high focus area for the company because the growth opportunities are not that high in this segment. Got it, ma'am. Got it. Ma'am, how has food been this quarter? Has the war impacted in any way? There was an impact, especially the last fortnight of March, because we serve exporters and we also support import testing at the NFL in Navi Mumbai. There was an impact in the last fortnight. Okay, ma'am. Understood. That's helpful, ma'am. I have more question, but I will join back in the queue. Thank you. Sure. Yeah. The next question from the line of Anjali Singh from Bansal Family Office. Please go ahead. Hello. Thanks for the opportunity. My first question is on the export side, could you please quantify what is the percentage of export revenue? In Q4, it has been around 38%. Okay. One more question. Now that we have a new facility up and running, what are the overall utilization levels? Utilization will slowly pick up because you don't build a facility, wherein you are going to occupy it, you know, immediately. That's not how you plan facilities. Utilization will pick up this year, a little more next year, more the following year. That's how it is done infrastructure-wise. Okay. Okay. One last question, ma'am. You have mentioned that new biologics contract research will commence from FY 2027, that is next quarter means. How are we placed at the moment, and how are the efforts being put to bring in new projects for the company? Some projects are under discussion, like I was mentioning in my opening remarks. The people, systems, infrastructure, equipment, it's all ready, and we are discussing some projects, and we hope something will materialize soon. Okay. Okay. That's all from my side. Thank you so much, ma'am. All the best. Thank you. Next question from the line of Umesh Matkar from Sushil Financial Services. Please go ahead. Yes, thank you for the opportunity. Ma'am, I would like to know about the subsidiary that has been approved in U.S. In which segment are we looking into and also what sort of investments are we going to incur for the U.S. subsidiary? The purpose of undertaking this is to be closer to our customers because we have a sizable population there, and also to give them greater confidence. We are on their soil, so it gives greater confidence for them. For as of now, that is the intent that we have. If something develops in the future, you know, beyond this, I will certainly come back to all of you. Okay. Does it give advantage to us in case of tariffs if we set up a subsidiary in U.S.? No, not much. There's hardly any impact of tariffs on the services that we provide. As the MD has just mentioned, this is the main purpose of opening the subsidiary there is to be closer to the customers. Right. My last question is. I think. Yeah. Got it. Go ahead. Yeah. My last question is with the new capacity that has come up, so what sort of revenue can we look into, say, once it fully gets off, get utilized? The idea is to, when we took up this project of expansion, the idea was to have a facility that can take care of our growth, at least for the next four, five years. I think, we are good so far. You know, we have moved into these facilities, and we see growth happening, as you have seen for the last financial year. The idea is to keep on continuing this momentum. Okay. Thank you very much, and wish you all the best. Thank you. Thank you. Reminder to all the participants that you may press star one to ask a question. Reminder to all the participants that you may press star one to ask a question. We have next question from the line of Advait Bhadekar from EY. Please go ahead, sir. As there is no response, we take the next question. We have next question from the line of Mr. Rohan Shah from RS Investment. Please go ahead. Thanks. Ma'am, how are the electronics and electrical testing scaling, and what is their medium-term potential? Last year for us has not been very exciting in this segment. We were hoping that we would pick up some more momentum here. We had leadership challenges which are fixed now. Leadership challenges on both the technical and operational, Sorry, operational and BD side. This is fixed now. Despite those challenges, I think the team has progressed. It is very encouraging for us. We have retained most of our customers, and the word of mouth is strong for us in this region. Now since that factor is addressed, we hope to see some strong momentum coming here. Got you, ma'am. That's helpful. Ma'am, also, with a net debt-free balance sheet and, you know, INR 650+ million cash, how does management plan to deploy capital going forward? Very good question. As of now, there are no firmed-up thoughts on what we will do with this money. It's good to always have cash on hand, especially in these uncertain times. For now I have no specific information to share. Okay, ma'am. I understand that. Ma'am, one more question if I may squeeze in. Are there any plans for acquisition, capacity expansions or investing in any new service lines? I said, nothing concrete as of now, but if something materializes, I'll definitely come back to you. All right, ma'am. All right. Ma'am, how should investors think about margins in the biologics business compared to the core testing business? Honestly, now we think the margin should be around this region. You know, our expectation is that it might be a% or a few% here and there. The reason why we say this is because the early projects may come more from, you know, the domestic clients. Also the other aspect is the cost of input material is quite high here. Once we develop some traction here, and we have a track record of successful products, processes that we have developed, you know, under our belt, we can go overseas. I think when we go overseas, the margins can be good. All right, ma'am. That's from my side. Thank you, ma'am. Thank you. A reminder to all the participants that you may press star and one to ask a question. We have next question from the line of Amitha Mody, individual investor. Please go ahead. Ma'am, our original plan was to cross INR 500 crore revenue annualized. Where do we stand? Is it possible to achieve it in FY 2027? Secondly, how confident we are to maintain our EBIT margin over 35%? Yes, we have had a very good CAGR during the last five to seven years. We want to maintain that CAGR, if you extrapolate that, yes, the number that we are talking about is what we are also targeting. Our goal was to hit INR 500 by last year. Because of divestment of diagnostics, we said, you know, we will try to get to those run rates by Q4. Again, Q4, some headwinds in terms of external factors. I think we put a very strong effort, we would have really gone close to that number. Some things did not happen for us, which we were expecting. Going forward, we are hopeful, very, very hopeful. There are uncertainties in the environment now, as you all know. One more question, ma'am. Is there any plan to raise money to ramp up the CapEx plan? Like we have cash of INR 55 million on hand. Is there any plan near term by way of rights issue or some other way? As of now, we don't need anything from that kind of a method. If there is, then we will definitely share that news. Okay. Thank you. Thank you. Reminder to all the participants that you may press star and one to ask a question. As there are no further questions from the participants, I now hand conference over to management for closing comments. Thank you to all the participants who took the time to join the call. I also wish to thank Systematix, especially Vishal, for being here and facilitating this call. Good day to all of you. On behalf of Systematix Institutional Equities and Vimta Labs Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.