Ladies and gentlemen, good day and welcome to the Neuland Laboratories Limited Q3 and 9M FY25 earnings conference call hosted by Ernst & Young. As a reminder, all participant lines will remain 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 the operator by pressing star, then zero on your touch-tone telephone. Please note that this conference is being recorded. I now hand the conference over to Mr. Ravi Udeshi from Ernst & Young. Thank you, and over to you, sir. Thank you, Ryan. Good evening, friends. We welcome you to the Q3 and 9M FY25 earnings conference call of Neuland Laboratories Limited. To take us through the results and to answer your questions, we have with us the top management from Neuland, represented by Mr. Sucheth Davuluri, Vice Chairman and CEO, Mr. Saharsh Davuluri, Vice Chairman and Managing Director, Mr. Abhijit Majumdar, CFO, and Mr. Sajeev Emmanuel Medikonda, Head of Corporate Planning and Strategy. We will start the call with a brief overview of the financials by Mr. Abhijit Majumdar, and then Saharsh will give you broad highlights of the business trends and what he is seeing in the market. And for this, we will open up the call for the Q&A session. As usual, the standard safe harbor clause applies as we start the call. With that said, I now hand over the floor to Abhijit. Over to you, Abhijit. Thank you very much, Ravi, and a good evening and warm welcome to each of you for joining our call. The financials are as follows for Q3. Total income is 401.9, which is a slight increase of 1.8% year-on-year as compared to 395.0 crores in the same period. This growth was driven primarily by the Prime GDS and Specialty business. As said consistently, I'd like to point out that the inherent nature of our overall business is uneven on a quarter-on-quarter basis. As we've mentioned in earlier calls, this financial is expected to be flat. Our EBITDA excluding exceptional items of 55.8 crores stood at 90.3 crores with a margin of 22.5%. The decrease in contribution is attributed to the business mix and increase in operational expenditure, leading to a decrease in EBITDA in Q3 FY25 as compared to Q3 FY24, where EBITDA stood at 122.7 crores. Now coming to the specifics, the gross margin for the quarter was 53.2% as compared to 59.8% in Q3 FY24. This gross margin, as always, includes manufacturing expenses and other costs directly attributed to the product. The profit after tax was INR 101.4 crores as compared to INR 80.7 crores in Q3 FY24. This includes an exceptional item of INR 55.8 crores arising from the sale of investment property. The quarterly EPS stands at INR 79 per share. For the nine months ended, our revenue stands at INR 1161.5 crores versus INR 1180.8 crores, a marginal degrowth of 1.7%. EBITDA excluding exceptional items of INR 76.4 crores stood at INR 284.6 crores in the nine months of FY25 as compared to INR 362 crores in nine months FY24. We continue to focus on cash to optimize our working capital, which stands at 111 days of sales. We generated a free cash flow in the nine months of INR 70.8 crores. We also paid some of our term loan debt of around INR 27.2 crores. Consequently, our net debt position stands at a negative INR 185.1 crores. As part of our investments, we have invested INR 147 crores in capital spends during the nine months, and we are committed to balancing growth and profitability by continuously optimizing costs and processes to ensure long-term sustainability. While we expect FY25 to be flat, we remain confident that our business will regain momentum from FY26 based on significant order pipeline and customer demand. Overall, we continue to be cautiously optimistic about our future potential that our business holds. With that, I would like to hand over the call to Saharsh for his remarks. Thank you very much. Thanks, Abhijit. Good evening, everyone, and welcome to the call. Over the years, Neuland has steadily established itself as a dedicated API solution provider, possessing in-depth expertise in extensive complex chemistry capabilities, and we are collaborating with both innovators as well as generic formulators to create a healthy world, so before talking about this quarter, I'd like to reiterate a few points which we have made in the past. One, our business is uneven due to the inherent characteristics of the CDMO business as well as the specialty GDS business, which is focused on small volume products. As a result, evaluating Neuland's trajectory on an annual basis is perhaps a more accurate measure than comparing quarter-to-quarter results. Again, there may be the odd year also where the trajectory will not be clear due to the specific mix or how products are taking off. However, the completion of manufacturing facilities coupled with the scaling up of commercial molecules on the CMS side gives us a great deal of confidence of achieving our stated objectives in FY26 and beyond. We continue to see increased interest in customers wanting to partner with Neuland as they look to bring in their innovative medicines to patients. And I think in many ways, this can be attributed to three factors. I think one is our reputation is continuing to grow as a result of the work we've done over the last couple of decades, especially on the CDMO business. Second, I think our business development teams who are also seeking new relationships are getting increasingly focused on finding the right opportunities that actually fit our long-term strategy. So being very selective, very decisive in whom we want to work. Thirdly, I think the macroeconomic factors which we all have been talking about also have been favorable to us, and therefore, we are enthused by the range of customers expressing their interest in working with us, and I think that's what's kind of giving us excitement about this business. Coming to this quarter, the CMS revenues were about 156 crores, as stated earlier. They were driven largely by molecules in the commercial segment. As indicated last quarter, one of the molecules in the CMS segment got recently commercialized. We are seeing good traction in terms of early-stage projects as well as customers reverting to us with more projects in their pipeline, so we expect the buoyancy in the CMS business to continue going forward and don't have any concerns at the moment. On the GDS side of the business, we remain focused on innovating new specialty products while optimizing processes and expanding market share for the key commercial APIs. The Specialty API business, actually, the growth is back on track this time. If you recall the last quarter, I think the growth was weak. And this is largely driven by paliperidone and dorzolamide this time. In the Prime segment, the strong products for us this quarter were mirtazapine, ezetimibe, and escitalopram. And we are confident we are on course to meet the overall targets for the GDS segment for the year. I would like to emphasize the inherently variable nature of our business, which makes it challenging to provide any form of guidance. But having said that, in the manner in which the orders are currently taking shape, we expect FY25 to close on a relatively flat level, which is in line with the comments we had made last quarter as well. And on a side note, I'm happy to share that Neuland has increased its S&P ESG rating to 70 compared to 64, which was the previous rating we had. And further, Unit 3, our nearest manufacturing site, has recently been awarded the prestigious Sword of Honour award by the British Safety Council. Another reminder from our previous interactions, we continue to maintain that there are a variety of factors that could influence our projections. These include performance of individual products, foreign exchange fluctuations, raw material cost volatility, and other dynamics of the business. We are aware of these challenges and continue to monitor these variables very closely. Regarding future capacity building, we are progressing as planned towards completing the new production block in Unit 3 and expect to commence commercial production in FY26, which is also going as per plan. As many of our long-term investors know, Neuland has invested in the peptide space for the last 15-17 years. We, in fact, have a team of around 50 peptide chemists who work in our R&D side, and they have delivered multiple projects at lab and small scale. We have now reached a juncture where we need to enhance our peptide capacity to scale our business to the next level, even as we've received a lot of interest from customers in our capabilities. And as we all know, peptides are being considered a new modality for an increasing number of therapies. So this led to the announcement of the capacity enhancement for which you would have seen the press release and the disclosures. Neuland's flexibility and agility are crucial for effectively responding to the business environment. And our growth strategy remains focused on pursuing high-value molecules from innovative companies, both on the CMS side and the GDS side. And we are committed to enhancing customer experience, which we believe that distinguishes us as a distinctive API provider. So our commitment to the future is evidenced by our investments in enhancing our capacities as well as capabilities, adhering to our foundational values of customer centricity, agility, and operational excellence. Neuland is well positioned to capitalize on long-term opportunities, even as we continue to navigate any short-term challenges that may come our way. So having said this, Ravi, I request you to open it up for Q&A. Thank you. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use their handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Ayush Agarwal for Maple Value Investing Fund. Please go ahead. Good afternoon, sir, and thanks for the opportunity. I hope I'm audible. Ayush, if you could please use your handset. Sure. Is this better? Yeah, this is better. Thank you. Great. Sir, my questions are on bempedoic acid, and I wanted to understand more on the supply chain. As I understand, there are two players currently marketing in distinct geographies, and we share a relationship with the innovator. So do we also share a relationship with the Europe partner because they are to shift their manufacturing supply chain to the Europe partner? And can that affect us if we don't integrate ourselves in their supply chain? Yeah. Sorry, we will not comment on any specific CMS molecules. So if you have any other questions, we'd be happy to answer them. Okay. On this only, maybe if you can say what is the current capacity of bempedoic acid and what are we expanding it to in our next quarter? Sorry, Ayush, we don't respond to any questions on a specific CMS molecule because of the confidential nature of the business. So therefore, we would not be able to comment on any question that you ask about a specific CMS molecule. So I would encourage you to ask a question about the CMS business or anything about it or about capacities in that front. But unfortunately, we will not be able to answer any product-specific question. I'm really sorry about that. Understood. I'll just join the queue. Thank you. Ladies and gentlemen, please restrict yourself to two questions per participant. The next question comes from the line of Shyam Srinivasan from Goldman Sachs. Please go ahead. Yeah. Good evening, and thank you for taking my question. Just on the peptide announcement, Saharsh and team, if you could, INR 255.54 crores is what I think we have articulated. So how should we look at that in terms of what are the next steps in terms of either timelines? I know you don't talk specific clients, but is this tied to a CMS client, or are you doing it for the generic GLP ones? So some color around the entire peptide project, and when can we expect timelines and monetization of these assets? Yeah, Shyam. So the investment itself is kind of spread across three different domains, largely for creating a new large-scale manufacturing facility in Unit 1. But a small part of that approved investment is also for enhancing the capabilities of our existing peptide facility, which is also located in Unit 1. So think of it more as a pilot-scale peptide facility. And another small part of that approved CapEx is for enhancing the R&D-scale peptide capabilities. So in many ways, this entire CapEx, I would say a majority is going into creating a large-scale facility, which does not exist today. A small part into the pilot facility and a much smaller part into the R&D facility. And the idea is that with this investment, we'll have seamless capabilities from lab to pilot to commercial for peptides. Having said that, the idea is to create facilities which would be usable for both the GDS business as well as the CMS business. And unlike some of the other investments, these are not product-specific investments. So to your question, there is not one anchor product or one anchor customer for which this investment is being made. We are looking at it as an opportunistic investment to kind of take us into that peptide domain by giving us a larger piece of infrastructure. So the plan is to file maybe two DMFs for the generics business. One of it would be a GLP-1, teriparatide, and this is public information. We've disclosed it before. And another peptide called difelikefalin. Both are generic peptides. These would be scaled up in that new facility, and a DMF would be filed. Other than that, there are also CMS opportunities which are currently either under R&D or under discussions with customers, and those could potentially be future projects for that peptide facility, so the idea is to have a mix of CMS and GDS projects, and if the business continues to do well and we have successful projects, then there could be subsequent investments which we will take up in the future years to further enhance the capacities, so that's the broad overview of the investment. At the moment, we don't have any definitive visibility on revenues or products or cash flow, so we will have to see how it goes. It will probably take three to five years to really ramp up this investment. Very helpful context, Saharsh. Just some follow-ups, and I'll take a second question if it's okay separately. When we talk about peptides, are we also in GLP-1 category, or these are broad-based? This could be non-GLP-1 as well. Yeah, I think GLP-1 also falls under the domain of our capabilities, Shyam. It's a synthetic peptide. So anything that's a synthetic peptide would fit into Neuland's capabilities. teriparatide is one of the products we are developing for the generics market. That is actually a GLP-1 category product. The other GLP-1s we are evaluating, but it's too early to say. Yeah. Understood. Last question on this is on the size, the capacity, right? We'll probably reach 6.4 kiloliters over time. Saharsh, in terms of landscape, if you look at the WuXi AppTec of the world, they are at 40 KL going to 100 KL. So do you think this is a meaningful scale and will help you win orders globally? Yeah, I think, Shyam, see, unlike our small molecule business, right, where 1,000 KL means something very definitive, in peptides, this whole KL business is a little tricky. So I'm not quite sure if it's an apples-to-apples comparison. From what we know about the space, and I think based on all the work we've done, we believe it's a substantial investment, and it is a fairly large-scale facility, and it should provide meaningful volume of peptides. But yeah, again, I don't know much about the infrastructure of WuXi, so it's difficult for me to compare, but I know it's a big jump up, and it would probably be one of the large peptide facilities, at least out of India. Understood. Thank you, and all the best. Thank you. The next question comes from the line of Sajal Kapoor from Anti-Fragile Thinking. Please go ahead. Yeah, thanks for taking my question. Good afternoon, all. Only two questions I have. First is, any thoughts that you could share around this sudden kind of almost U-turn type of thinking from big pharma, big global innovators? They are now returning back to small molecule spaces, and there is a pattern developing. And this is not in the last one month or two. I mean, if you look at what they have done over the last, let's say, 18 months in particular, if not after COVID, there is a definite desire and intensity to come back to small molecules. I mean, is it related to patient compliance? The oral molecules are easier to administer, or is it something to do with the cost or a combination? I mean, what is the reason I'm asking is previously big pharma's statements was that biologics will rule the world, and small molecules, we are done and dusted with the R&D. Yeah, Sajjal, maybe just a short response because obviously, we are not the experts in commenting on the broader theme that you are referring to. I think definitely what you're saying is true. There seems to be some sort of a reversal in terms of the pipelines, so to speak. I think what we have been told is that sometimes companies are just pursuing a therapeutic area, right? Let's say a big pharma wants to go big on CMS. Now, ultimately, they are pursuing CMS assets because they have a CMS infrastructure. And ultimately, if it's a small molecule, then it's a small molecule. If not, it's a biologic. That's the only limited understanding we have. But you're right, as in there seems to be some sort of reversal maybe because costs are more attractive in small molecules. Maybe I think the formulations are more easier, but again, not the experts to comment further on that. Sorry. No, that's absolutely fine. Thank you for that, Saharsh. And a question for you, Abhijit. So you have mentioned the free cash. I'm asking about operating cash. What was the nine-month operating cash after adjusting for all the working capital? So the nine-month EBITDA is about 272 crores. How much of that has been converted to net operating cash adjusted for working capital? Operating cash net of CAPEX is INR 70 crores. No, including CAPEX, what is the operating cash? 70 plus 147. So you can take that as 230. Okay. So this is out of INR 272 crores of nine-month EBITDA? That's right. Okay. Brilliant. Thank you so much. That's all, guys. Thank you. Thank you. The next question comes from the line of Aditya Khemka from InCred Asset Management. Please go ahead. Hi. So this was to better understand the CMS segment. Today, in terms of the active CMS projects, out of 97, 19 are commercial, but the bulk of them are pre-registration or below. So whether the development income, that is almost down 50% YOY in nine months, is there an element of few molecules driving the bulk of CMS development revenue today? And if you could help us understand better in terms of your CMS pipeline, since bulk of the projects are still on the development side, why is there more volatility in development versus commercial? So if you could comment anything on that. So I think to answer your question, in terms of the revenues, they are mapped to the actual flows during the course of a quarter and during the course of the year. And as we have said in the past, we expect that a lot of the growth that we were expecting was going to come in from the commercialization of molecules. In the past, you would have seen that we have had significant revenues even from the development part because we have had molecules which were ready or where the customer was looking to take quantities for launch, but the product was not yet approved. So as a result of that, those revenues were recognized as development revenues. But once a molecule is approved and we are part of the filing, it moves to commercial. And that is why that scales faster and is a higher proportion, whereas the development quantities are likely to be volatile because we are, say, waiting for a customer who takes material for phase two to come back for phase three, which may take longer time. So that largely explains the volatility in development. And I think the commercial revenues tend to be a lot more stable. And I think ultimately, the other factor that matters is different molecules contribute different scales of development revenue. So while it is a little difficult, maybe even for investors from the outside, but the truth is that development revenues are going to be very lumpy and volatile. And ultimately, I think that's why we try to give an aggregate sense of where the business is heading. But yeah, I think for us, for now, commercial revenues are what could be seen as a stable base from an outside perspective. And that's why we give the split between commercial and development. Got it, sir. That's it from me. Thank you. The next question comes from the line of Sanjay Satapathy from Ampersand Capital. Please go ahead. Yeah, sir, thanks a lot for the opportunity. My first question is that when you mentioned your commercial CDMO revenue is much more stable, but in quarter one, it was some INR 170 crores. From that, it has fallen to some INR 110-INR 120 crores. What could be the reason for this decline, sir? Sorry, which revenue are you talking about, that decline? The commercial part of the CMS business. The commercial? Yeah, I think, see, again, commercial revenues, I would not look at quarter-to-quarter movement to look and maybe call it a decline or a growth because I think a lot of times these products are lined up to get dispatched across different quarters in a year. And I think the way the mix is coming out is how it is. And as I had mentioned in the opening remarks also, I think our portfolio is doing well, and I think molecules are continuing to grow steadily. So there's nothing to concern, nothing of concern with regards to CMS commercial for the moment. I think a quarter-to-quarter movement is very natural in our business. It's a little bit if you can just explain that when this molecule goes from development to commercial, so you get to apply for that commercial for several years together, right? It is not as if it is a very small window of opportunity. Yeah, I think typically the way the relationship works with the innovator is that once it gets into commercial, we would continue supplying API until the patent expires. And of course, there are a lot of dynamics at play. There could be additional sources that could come in, and that could have an impact on the volumes. There could also be performance of the drug itself that would matter. But when we track these molecules, we are constantly looking at the IP timelines, and therefore, that's what we look at. The gap between the development to commercial, as in what could be the waiting period, that again depends molecule to molecule. Sometimes there's hardly any gap. You finish development, and then there's a short break, and then you start commercial. Sometimes you supply development quantities, and then they go through an NDA filing and an approval. Sometimes you might have to wait for a couple of years as well, so it's very hard to have a standard expectation for this transition from development to commercial. I mean, it has nothing to do with the product not living up to its potential or scale because the FY you had given some 5%-10% kind of growth guidance at the beginning of this financial year. You had brought it down to about flatish number. So I mean, was it because of slower response to some of the new products which are commercial, or how one should be looking at it? And when we are looking at a better growth from FY26, is it going to be because of more number of products becoming commercial or same businesses scaling up a lot more? Yeah, see, again, Sanjay, I don't think there's any concern per se. I think our business is such that we have limited high-value products that contribute significantly. Our revenue and our forecasts and our budgets are based on our dispatch plans. And a lot of times, due to various reasons, things get shifted a little bit. And I think we kind of expecting a moderate growth, which was stated earlier, and then we kind of revised that to say it's flatish, is more to do with those dynamics rather than with how the products are performing. And as I said it already, our products are doing well, and I think the CMS business and the GDS business, I think whatever we have stated that FY25 is going to be a flatish year, I think is actually an amalgamation of how the products are picking up. But I would not read too much into that change from moderate growth to flattishness beyond what has been already said. Understood, and if you can just help us. If you can please reach out the queue. Your bottom line, the margin has come up quite a lot. Is there any kind of sense of how margin will recover from here on? Maybe we'll answer this question later, Sanjay. I think there's a long queue, so please, I think let the moderator take the next question, and we'll get back to you. Thank you. Ladies and gentlemen, in the interest of time and fairness to others, we request you to restrict to one question per participant and rejoin the question queue. The next question comes from the line of Ishmohit from SOIC Research. Please go ahead. Hi, sir. Congratulations for turning around your business over the last five years from 12%-13% EBITDA basically operating margins to at least reaching 20% even in a flatish year. So, sir, my question was, see, FY24 was an inflection year for us. FY25, we understand the train is waiting at this station. Do you think FY26, FY27 again will be sort of inflection years for us when it comes to our product mix change and CDMO business really accelerating from it? Yes, I think as we had said earlier, we expected FY25 to be a kind of a flattish year. And we also had stated previously that we expect growth to resume from FY26 onwards. And therefore, we expect our business to continue growth from FY26 onwards as well. But again, we've kind of restrained ourselves from talking about FY26 versus 27 and how that will pan out because I think it's better we kind of look at a slightly broader horizon than try to kind of look at it. But 26, growth should resume. That's something that we want to say it very clearly. Can I ask a second question or? Yeah, go ahead. Yeah. So second question was that in a pre-commercial stage, currently we have 11 molecules, I think five in intermediates and six in APIs. Are we expecting any of these to go commercial in FY26 or 27? One at least, maybe two, but we'll have to wait and see because again, these are still going through trials and filings, etc. But one we are fairly certain will happen in the next year. Okay. Thank you, sir. Wishing you all the best for the future. Thank you. The next question comes from the line of Sachin Kasera from Swan Investment Managers. Please go ahead. Yeah. Hi sir, and congrats for the progress that we achieved in the last two, three years. I just had one clarification. One of your slide number 12 in the presentation mentions that the pre-registration of the phase three molecules, which you used to early classify as part of development, are now part of commercial. And so this is effective, which financial year you have done the reclassification. So when we look for the nine-month FY25, your development revenues are 116 versus 232. So in that case, the 232 of nine-month FY25 includes the pre-registration in phase three or anything? Is it like to like? Just a clarification I wanted. Yeah. So I think if you look at revenues for FY24 for the nine months, it includes I think the classification of development and commercial remains the same. It's only that a molecule which was in, say, pre-reg phase moved to commercial during the course of the year. And I think that moved at the end of Q2, so from Q3 is being recognized, say, from Q3 will be recognized as commercial revenue. Sure. I understand that quarter to quarter is not fair, but at least if you look around nine month to nine months, and if I look at your filing, if the number of products in preclinical phase one, phase two, phase three are more or less the same, so this decline from triple two to 116 is primarily because one large molecule which was earlier where you had booked revenue as commercial is not being booked under commercial. Is that what is causing this type of sharp decline in your development revenues nine month to nine months? Yeah. I think yes, that is correct. And I think in general, when there are large increases in development revenue, that is usually an indicator that means either there is a large clinical trial or there is a molecule where the quantities are going for launch. So I think those are two indicators, especially when the development volumes go up. Sure. My second question is on. Please rejoin the queue. This is my second question. I believe everybody is able to ask two questions. That's what you have mentioned. So my second question on peptides, we announced a fairly large CapEx. Over a period of time, once it is fully utilized, can you give us some sense in terms of what type of revenue we could see two, three years after the commercialization of the peptide block? Thank you. Sachin, at the moment, we would not share anything because I think it's a very wide range. And I think maybe over time, we'll probably be able to give a better color because again, it depends on what molecules scale up over there. And therefore, there is a very wide range, and it might not be very helpful for you guys. But I think maybe in the course of time, we will try to give a little bit of color on that. But for now, maybe we'll just hold off. Thanks, and all the best. Thank you. Thank you. The next question comes from the line of Yasser from M3 Investment Private Limited. Please go ahead. Yeah. Hi, good evening. So broadly in your CMS side, we've seen 81. I'm sorry, your voice is breaking. I'm sorry, I'm not able to hear anything. Hello? Is this better now? Yes. Yeah. So could you sort of put on the in terms of big pharma, small biotech, the mix of that? And secondly, typically when you've seen this increase in projects, how many customers have sort of more than one project with us? Could you give us some sort of? Could you repeat that first question again? It blanked. You said something about big pharma, biotech, but could you just complete that question? Yeah. So just in terms of your customer mix in these 97 active projects, have we sort of graduated towards moving towards working with big pharma? If you could give some qualitative sort of insights on that. Sure. And the second one again? The second one is, do we have customers that probably do have more than one project with us? Yeah. So I think the big pharma biotech split is something that we don't have, but we're largely a biotech company. And as we stated also in the past, usually if we are working with big pharma, it's either for a very specialized area like peptides or it's because big pharma has come and acquired our customers. We don't have that mix, and we'll see if we can provide that maybe at a future date. But you can presume that we are largely biotech-focused. With regards to multi-project customers, we do have several customers that we do multiple projects with. And again, we don't have the number for that, but maybe that's something that we'll get back to you. But I would say maybe at least 20%-30% of our projects are second or third projects with the same customer. It's just an intuitive number. Yeah. And as you sort of alluded to earlier, when a big pharma company acquires our customer, so what would be your experience over the years where you've seen they switch over to maybe someone in their CDMO sort of value chain, or do they tend to persist with Neuland? And if you could sort of share some experiences over the years, how does that play out? Yeah. Again, maybe this will be a generic response based on our own experiences. What we have observed is that because there is a regulatory filing involved and Neuland is registered as an API manufacturer, there is anyway a certain level of stickiness that is involved with our site. So it's not very easy to displace Neuland as an API company, even if the big pharma is not very familiar. So that's point number one. Point number two, I think even from a big pharma perspective, I think they just look at things from a risk point of view. And as long as they feel comfortable that this company that is currently producing the API is not going to create any significant risk for their API supply, they would tend to continue working with us. That's the second point. Third point is, ultimately, I think the long-term relationship is dependent on our ability to execute and deliver. And I think that's where the relationship is built. And I think that's the journey that Neuland is kind of going in right now. But I think just given the advanced nature of these programs, even if there is not a lot of familiarity with big pharma, we have not seen any kind of reluctance or hesitation to work with a new API supplier provided the risks are manageable. And I think that's where Neuland stands out because our facilities in terms of our quality management system, in terms of our ESG practices, they all are top tier, not just in the country, but even at a global level. And that also creates a certain level of comfort for these large MNCs when they come to evaluate Neuland as an API company. Oh, fantastic. That was really helpful. Secondly, on the generic and specialty side, I mean, I just wanted to sort of get a long-term vision here for this business. In terms of eventually, do you plan on probably becoming a cost leader in a few molecules? What are your thoughts on sort of backward integrating in some of them? And do we look at this sort of the generic and the specialty piece more as a capacity utilization play to sort of combat the cyclicality of the CMS business? Or is it like, as I said earlier, do you want to become a cost leader and eventually a market leader in some key molecules on that portfolio? If you could shed some light, that would be really helpful. Yeah, sure. See, I think Neuland as a company, I think for us, the GDS business is as important for us as the CDMO business. And in many ways, they're not really competing with each other, right? Because ultimately, there's a lot of synergies in these businesses, and they cater to different customer segments. And because of that, our strategy over the long term is to pursue both the businesses in parallel. However, the way we have nuanced our approach in the GDS business is to try to move a little away from prime and go deeper into specialty. And we believe that going into specialty gives us the ability to command that market share leadership, which sometimes is very difficult to achieve in the prime products where price tends to be the key determining factor. So I think over a long-term perspective, I don't want to get into the growth rates and the business mix because, again, that's too detailed kind of guidance that we would give. But ultimately, both businesses' idea is to grow them to their best potential. Even if you take the example of the new peptide facility, it has been designed to cater to both GDS customers and CMS customers. And ultimately, what products, what segment will do more revenue in the peptide facility remains to be seen. So I think that's the effort. But however, I think we will not focus as much on generics just because it's not really an area of our strength to compete on price. But we will focus more and more on specialty products. And eventually, a molecule like peptide will also become a part of the specialty portfolio. Sure. That's really helpful. Thanks, Ler, and congrats on your performance over the years. Thank you. Thank you. The next question comes from the line of Rahul Bhardwaj, an investor. Please go ahead. Thank you for the opportunity and congrats on the numbers. So one question. Great performance over the last decade, I think more so over the last five years. How should we as investors kind of look into this trajectory? If you can kind of color this, what should be the what are the company's expectations for the next five to 10 years? How do you see the business mix changing? And I know you won't get guidance, but in terms of numbers, your part has grown around about 30% in the last 10 years. I don't know, maybe 70-plus% in the last five years. Should we look at the growth in the last five years more of an exception? How should we kind of look into this data? And how do you see the business going in the next five to 10 years? I think just to add, I think in the past, we've kind of focused on moving from prime to specialty and CDMO side of business. If you can give a bit of color into this, that will be helpful for everyone, I think. Thanks for your question. Harsh alluded to this in his previous response, but just to reiterate that, I think going forward, we have equal emphasis in terms of growing our generic business as well as our CDMO business. Our sweet spot in the CDMO business is to work with biotech companies which have molecules all the way from preclinical to clinical to phase three, all the way to commercialization. On the generic side, we focus more on the specialty APIs where the barriers to entry are much higher. Obviously, many years ago, 80% of our revenues came from prime sort of products. But over the years, we've systematically focused on developing molecules with higher barriers to entry, more IP protecting it, and our ability to hold on to a market share for a longer period of time. I think in terms of efforts, both in terms of CAPEX, the resources allocated, the number of molecules that we select, the life cycle management that we do, our supply chain strategy, everything is geared in the organization to make sure that we focus on both of these segments equally. Obviously, we see the CDMO business to have a little bit more potential because the market is larger, and we still look at ourselves as an organization that can gain a lot more market share on the CDMO side, and therefore, you see higher growth in that business as well, but from an emphasis point of view, it's going to be equal going forward. Thank you for your response. I think I had one pending question from some of the previous calls. It was in regards to any thoughts on stock split that the management would have thought about if it's good or not good for business and investors, if there's any update on that. No specific update at this point, but obviously, the board of the organization from time to time does examine these sort of issues from a shareholder point of view. But currently, we don't have any specific updates. Thank you so much, and good luck for the future. Thank you. Ladies and gentlemen, in the interest of time and fairness to others, we request you to restrict to one question per participant and rejoin the question queue. The next question comes from the line of Gaurav Mahidhar, an investor. Please go ahead. Hi. Hi. Firstly, I would like to thank the management for being so forthcoming and honest with their guidance. It really makes a difference. Thank you so much for that. So I have a couple of questions. I'll fire the first one. What percentage would the cost of an API form for an NCE from an innovator's point of view? I'd guess it would vary from molecule to molecule. And if my guess is correct, what are the factors that affect it? Does the complexity or a certain scale of manufacturing required by the API supplier affect it? That's the first question. It's actually, I think maybe this question was asked in the past, and it's a very difficult question to answer because there is a very wide range of what percentage an API could be in terms of the final drug product pricing. We've seen products where it could be as high as 10-12%. We've seen products where it's like 0.1%. And honestly, I think it's very difficult to be able to determine even for us what would be an appropriate number to take. So I think maybe it's a very, I'm not quite sure how much we can help you on that front. Yeah. So maybe if you can go ahead and ask your next question. All right. No issues. We currently garner 40% of our revenues from the U.S. If push comes to shove, how would import tariffs affect us and our supplies to the USA? See, I think we have considered all possibilities, and we have also, as part of our enterprise risk management, we kind of look at all kinds of risks, including tariff risks, geopolitical risks, etc. I think just looking at all plausible scenarios, I think one thing to consider, I think just from a Neuland perspective, is that we make APIs, right? We don't do drug product. And most of the APIs we make are the alternate sources are either in China or in Europe or in India. There's not a lot of captive capacity for these APIs in the U.S. And therefore, it seems very unlikely that tariffs could be affecting our business directly. But having said that, I think also take into consideration that for most of the products we operate on, both in the GDS and CMS side, we are typically one of the only suppliers or maybe one of the two suppliers. And a supply risk would actually harm US patients. And that's also something to be taken into consideration. And yeah, so I think for us, we will have to figure it out. I think worst case, also understand our business. I think almost all our CMS as well as GDS specialty customers consider us to be partners. And if something substantial like a tariff would happen, we would work with the customer to ensure that that tariff cost is absorbed by the customer to ensure that there is a seamless supply of material. I think these are the few responses maybe I can offer. Anything else? Yeah. Thanks. Thank you. The next question comes from the line of Meet Patodia, an investor. Please go ahead. Yeah. Thank you so much for the opportunity. So Neuland has built a strong reputation as a trusted API player, right? Particularly in the cardiovascular segment, given the rising demand for certain cholesterol-lowering therapies in global markets. What factor does Neuland consider crucial for gaining further market share and improving supply visibility with the key customers? Yeah, my question. Hello. Yeah. I'm sorry. I didn't follow the question. Could you rephrase it and speak a little slowly? Sorry. So my question was on the key win in the cardiovascular segment. One cholesterol-lowering drug therapy is doing very well in the global market, right? So what factor does Neuland consider to gain more market share in the supply chain? I think it's, again, a difficult question to answer, right? Because the product you're referring to falls into our CMS business. And again, we will not be able to talk about product-specific questions due to confidentiality reasons. Okay. The only thing I'll add to what Harsh said is that I think as an organization, we focus on making sure that we are delivering the product on time, on the quality, on the compliance, as well as maintaining a competitive position. So basically, based on our history, what we've seen is that the market share that we gain is directly proportional to how we perform from a customer perspective. And that's where we focus. The wallet share or the market share is a direct outcome of that. Thanks. Okay. So also second short question, right? So the revenue guidance for FY25. I can interrupt you, but your audio is not clear. Hello? I'm audible? Yes. Please go ahead. Yeah. So, growth guidance for which you are giving for FY26 and beyond, is it due to the visibility in this cardiovascular API or any other molecules driving growth? Only this, Madam. I think the outlook we've given about growth resuming in FY26 is at an aggregate business level. It is not at a segment level or at a product level. So what we would like you to just take away from our message is that you can expect Neuland's business to grow in FY26. It was flat in 2025. It grew well in 2024. It was flat in 2025. And you can expect the growth to come back in 2026. I think that's the only message we have given. Beyond that, we will not be able to give any further details to it. Thank you. The next question comes from the line of Sanjay Kohli from Goldstone Capital. Please go ahead. Yes. Good afternoon and thank you. So I just wanted to understand that essentially, we are a 100% chemistry company. So when we supply to the biotech, what happens? Whether there's a biological manipulation of our products and then in some plant overseas, it gets developed into a biologic in case of the CMS and in case of the generic, either a biologic or a biosimilar. Is that what happens, basically? Because essentially, our customers are biotech. No, I think maybe the confusion also comes because we call these companies as biotech companies. But essentially, these are all small molecule companies. They don't really do any biotechnology work, or they don't do any biologics. The products Neuland makes are all small molecules. So they're synthetic and chemistry-based, and they're not biology-based. And it works similarly in the generics business. Our customers, these biotech companies procure the API. They get them formulated at another CDMO, packaged, and then sold. But the entire product value chain is only synthetic, and there is nothing to do with biology. I think perhaps what can create a confusion sometimes is that because the industry nomenclature calls these small and mid-size US-based companies, they are called as biotech companies. Ironically, although they don't do biotechnology, they are called biotech companies. But as you know, we are not in the biotech space, and therefore, we are not involved in the creation of any biologics. I hope that clarifies. I know it may not be a comprehensive answer, but I hope it helps. Thank you. Ladies and gentlemen, due to time constraint, we take that as a last question. I now hand the conference over to the management for their closing comments. Yeah. Thanks. Good evening and good evening, everyone. We want to thank you for taking the time and participating in the call. Your interest and the questions help us think deeper about the business and the future. We hope we have answered all your questions and in case of any further questions or feedback, please reach out to Ravi Udeshi of EY. Thank you all once again and wish you a good evening. Thank you. On behalf of Ernst & Young, that concludes this conference. Thank you for joining us, and you may now disconnect your line.